Import of reconditioned vehicles has hit eight-year-high with industry experts identifying popularity of ridesharing services as one of the reasons behind it.
Import of used cars has been continuously rising over the last five years, according to Bangladesh Reconditioned Vehicles Importers and Dealers Association (BARVIDA).
In the 2017-18 fiscal, a total of 23,102 reconditioned vehicles, which includes sedans, pick-up trucks and microbuses, were imported, registering a 14.75 percent rise from the previous fiscal.
Increase in ridesharing services, development of roads, low-cost car loans for public servants and a lack of public transport played a key role in the growth, according to importers.
“The rise in popularity of ridesharing services is one of the factors spurring imports,” BARVIDA President Habib Ullah Dawn told Dhaka Tribune.
Some experts estimate ridesharing platforms have contributed to an average of 5 to 10% import growth in the automobile market in recent years.
Md Shohag, an Uber driver, said he was earning Tk 1,000 per day, after expenses and paying the owner of the vehicle he drives.
Another Uber driver, Md Ripon started offering rides within two days of buying his own car.
“I bought my own car just to offer rides and make a good amount of money to run my family,” said Ripon, adding that he earns around Tk 2,000 a day.
However, several other importers disagree with the notion that ridesharing services contributed significantly to the hike in imports
Assistant General Manager of Nippon Car Trading, Md Shah Alam Bhuiyan, said that only about 5 percent of his customers had bought cars to be used for ride sharing.
“Last year, 5,000 government officials bought cars for personal use after the government provided them with the opportunity to avail car loans with very low interest rates,” said BARVIDA President, Habib, suggesting this was another reason behind the growth in auto imports.
Former president of BARVIDA and Autocon Group CEO, Abdul Hamid Sharif, explained that due to rising economic growth in the last decade, the purchasing power of people has increased.
“Additionally, Dhaka’s roads have become more developed,” he added, explaining that this may have also driven the car import growth.