Egypt’s auto market grew in June, but dealers warn of shipping pressure ahead

Egypt’s auto market grew 3.3% m-o-m in June, but passenger cars barely moved — buses did the heavy lifting, according to AMIC’s June report (pdf). Passenger cars — still 71% of volume — edged up just 0.7% m-o-m to 12.4k units, while trucks slipped 0.5% to 3.1k. Total sales are up 6.4% y-o-y, buses have more than doubled (+105.7%), and trucks are up 10.6% — even as passenger cars posted a 2.3% y-o-y decline, a dip AMIC’s report doesn’t explain.

That decline isn’t a red flag, according to two market trade voices. “There’s no such thing as a ‘peak’ for buyers,” Auto Traders Association President Osama Abu El Magd tells EnterpriseAM, adding that a 2% swing is small precisely because the market’s overall base is small. He also flagged a real gap in AMIC’s data: it excludes several major brands in Egypt — including all German cars. “If you look at actual traffic authority licensing figures, they’re very close, and a 1-3% change represents differences of no more than a few hundred cars a month — an insignificant change.”

How buses performed

Tourism categories stood out: Tourism Micro buses jumped from 120 to 296 units m-o-m (+147%), Tourism Maxi rose from 44 to 73 (+66%), and a category absent from May’s data — Transport Maxi-City — appeared with 30 units in June.

Passenger cars were broadly flat on the surface, but the underlying mix kept shifting.

The 1.5-1.6L engine band grew to 52% of PC volume from 48% in May of this year and 45% in May 2025. SUVs over 2.0L fell 42% m-o-m (353 to 205 units) — a move that may reflect the segment’s small base rather than a sustained demand shift.

EV sales, meanwhile, plateaued — at least according to AMIC: 352 units in May, while June stayed almost still at 351, even as the y-o-y comparison reads as explosive — up 3,410% from June 2025’s mere 10 units. That near-flat monthly reading comes as automakers and dealers continue to describe an EV market gathering momentum, though AMIC’s member-submitted figures do not provide a brand-by-brand breakdown. Mansour Automotive Group CEO Ankush Arora told us in February that IM Motors — a 100%-electric brand Mansour had just launched — was selling 50-60 units a month at the premium end alone, with BYD freshly soft-launched. Abou Ghaly Motors VP Tamer Kotb made a similar call, predicting range-extended EVs could hit 50-60% of new car sales in 2026.

The EV tariff idea dealers don’t want

Abu El Magd rejects a proposed 5% customs duty on imported electric vehicles as a tool to protect local assembly. “It won’t create a real competitive advantage for local manufacturing, and will only increase financial burdens on the end consumer and disrupt market movement,” Abu El Magd argues. “Protection comes from reducing production costs for the factory itself, not taxing the competition.” He adds that EV sales remain small, the market is still exploring the segment, and decisions require deliberation, study, and consultation. “What’s needed is identifying the bottlenecks in the production cycle and supporting them directly, instead of burdening the consumer with additional costs.”

Alaa El Sabaa, the auto division’s deputy head, put it more bluntly: “Adding EGP 100k to an imported car priced at EGP 2 mn won’t entice the local factory to expand — the factory itself is unhappy and unconvinced by this rate.”

On why dealers still favor imports over local assembly, Abu El Magd pointed to capital speed. “Importers cycle capital in about 3 months, versus 5 for local assembly,” compounded by a fragmented market, he says, adding that “200k cars split across 50-60 brands” leaves any single model’s production run too small to achieve economies of scale. Both he and El Sabaa independently raised Morocco as the model to follow: 700k cars against just 50k in domestic consumption. To get there, “the sacrifice has to start with the government — real incentives on energy costs, taxes, land, and procedures to cut production costs. A foreign investor is looking to reduce risk and turn a [gain], and won’t do the state any favors at its own investment’s expense,” Abu El Magd says.

How the localization effort is shaping up

Localization still has some distance to cover in passenger cars. Derived from the change in AMIC’s May and June YTD origin data, June passenger-car sales comprised about 5.6k locally assembled (CKD) vehicles and 6.8k fully built import (CBU) vehicles. That left CBU ahead by roughly 1.3k cars in June and ahead YTD. Commercial vehicles showed a much more localized sales mix: derived June figures put trucks at about 90% CKD and buses at roughly 74% CKD, compared with about 45% CKD for passenger cars. That suggests local assembly is more established in commercial vehicles, though the mix does not by itself measure domestic value added or manufacturing capacity.

REMEMBER- Al Mansour Automotive broke ground on a USD 150 mn MG manufacturing plant in 6th of October City in November 2025, with production expected to start in 3Q 2026. The plant is designed for a first-phase annual capacity of 50k vehicles. It would initially produce the MG5 sedan, with four-wheel-drive vehicles and EV production planned for later. If it ramps up as planned, the facility could materially increase CKD passenger-car output, although the effect on the CBU-CKD split will depend on its production mix, utilization, and domestic sales allocation.

Red Sea trouble is already squeezing supply

Both Abu El Magd and El Sabaa said pressure on shipping from East Asia could be the larger near-term risk for the auto market heading into 4Q 2026. “There’s severe pressure on all shipments coming from China, India, Japan, Korea, and Taiwan, as shipping routes rely on combined cargo heading to both Egypt and the Gulf,” Abu El Magd says. He notes that carriers are responding by charging steep transit premiums, waiting to consolidate additional cargo, or avoiding the Red Sea route and sailing around the Cape of Good Hope — a diversion that can, in some cases, double transit times. “A ship’s cycle that used to do four trips a year now does two — that doubles shipping, financing, and ins. costs and creates a real shortage.”

El Sabaa described the sector as “barely getting by” as a result, with both calling for government support targeted at supply-chain bottlenecks and feeder industries rather than single-factory fixes.

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