Egyptian Auto Traders Association Denies Central Bank Halted Dollar Allocation for Importers

Osama Abu El-Magd, head of the Egyptian Automobile Traders Association and vice president of the Automotive Division at the Federation of Egyptian Chambers of Commerce, flatly denied reports that the Central Bank of Egypt has stopped allocating foreign currency to car importers. He confirmed that banks continue to meet importers' dollar needs regularly and without delay. The denial was unequivocal.

The truth behind the dollar allocation reports

Rumors had circulated on social media over the past few days about an undeclared Central Bank directive to public and private banks to halt foreign currency allocation for car agents and importers. The alleged goal was to ease pressure on the foreign exchange market. Abu El-Magd dismissed the claims as baseless, stressing that banking transactions with importers are proceeding normally. The market is functioning.

Egyptian pound pressure and car prices

The allocation rumors coincided with the US dollar rising against the Egyptian pound and surpassing 56 pounds at the close of last Wednesday's trading. But the greenback retreated during Monday morning trading to below 55.5 pounds. This exchange rate volatility makes it difficult for importers to determine final vehicle costs in advance. The numbers shift fast.

Egypt's automotive market witnessed a broad wave of price increases during October that hit dozens of models with hikes reaching 100,000 Egyptian pounds. Some companies imposed repeated increases on several models within the same month. The increases weren't confined to one segment but extended across multiple models. Pressure persists.

Supply shortages and slowing imports

Khaled Saad, secretary-general of the Egyptian Automobile Manufacturers Association, said recent price hikes aren't linked to the dollar's rise alone. He explained that the currency's rapid and continuous movement makes it hard for importers to set final vehicle costs in advance. The factors are complex.

Saad pointed to supply shortages among traders and distributors alongside a slowdown in the import cycle as powerful drivers of rising prices. The impact covers fully imported vehicles and locally assembled cars that rely partly on imported production components. Kia and Hyundai are among the brands seeing repeated price movements. The situation grows more complicated.

This comes as Toyota and Nissan continue adjusting their pricing in line with market fluctuations, while consumers wait for exchange rate stability before making purchase decisions. No signs of near-term stability.