Industry Trend Analysis - Unfavourable Demographics, Poor Infrastructure And Economic Uncertainty Keeping Car Ownership Low - JUNE 2017

BMI View : A large rural p opulation, low income levels, poor quality road infrastructure and long-term economic uncertainty will keep passenger car vehicle ownership rates in Mozambique low over our 2017-2021 forecast period.

We forecast passenger car ownership rates in Mozambique to grow at an average rate of 7.3% over our 2017-2021 forecast period. Despite this robust growth, car ownership rates will remain below 23 vehicles per 1,000 of the population over the next five years, which compares unfavourably to the country's population growth (our Country Risk team forecasts that the population will reach 33mn people by the end of 2021).

According to our Autos Sales Risk Reward Index (RRI) - which quantifies and ranks a country's attractiveness based on the balance between the Risks and Rewards of entering and operating vehicle retailing activities in different countries - Mozambique underperforms the Sub-Saharan African (SSA) regional average across a range of 'risk' and 'reward' categories ( see ' South Africa, Mauritius And Botswana Outperforming In SSA ' , March 23).

Poor Outlook For Car Ownership Rates
Mozambique - Passenger Vehicles Density
e/f = BMI estimate/forecast. Source: INAV, BMI

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