New car sales point to expanded middle class in St. Kitts and Nevis
By Valencia Grant, Press Secretary to the Prime Minister of St. Kitts and Nevis
BASSETERRE, St. Kitts – St. Kitts and Nevis’ expanding middle class is driving year-on-year growth in the automobile industry, as well as in related sectors such as financing and insurance.
The prime minister, the Honourable Dr. Timothy Harris, who is the minister of finance, has said that “Something good must be happening when more [people] can afford to buy their own means of vehicular transport.”
More car sales bode well for gas stations and the automotive aftercare market, which consists of car repair and tire services, car washes, as well as businesses that sell an assortment of accessories and parts. Moreover, the licensing and registration of vehicles puts money into the public purse.
“During the year [ending Jan. 31], more vehicles were sold than at any similar period in the company’s history and there were significant increases in the revenues from the garage operations,” the TDC Group of Companies’ 2017 Annual Report states, while adding that: “the Automotive Divisions were recognized by Toyota and Suzuki for exceeding sales targets.”
A year ago, TDC noted in its 2016 Annual Report that “the year [ended Jan. 31, 2016] under review was a historic one for the Automotive Divisions. In December 2015, the highest monthly sales were recorded since the introduction of the Toyota brand in the Federation of St. Kitts and Nevis.”
TDC’s Directors’ Report 2015/2016 also noted back then that “At the Toyota Motor Corporation Latin American and Caribbean Distributors convention held in Argentina in April 2016, the Automotive Divisions [in St. Kitts and Nevis] were awarded the 2015 Toyota Vehicle Sales Silver Prize based on exceeding the annual sales targets, increasing market share and improving the customer satisfaction overall score. The departments also achieved the sales targets for Suzuki and received prizes from the Regional Office in recognition of this achievement.”
The Directors’ Report 2015/2016 continued: “The Automotive, Financial Services and Insurance businesses collaboratively staged a number of promotions. Customers had the option of accessing packages of financing and insurance when they purchased vehicles. The combined profits for the Automotive Divisions almost doubled those for the prior year.”
For the financial year ended Jan. 31, 2017, TDC Financial Services Company Ltd. (formerly FINCO) had another strong performance and its loan portfolio increased by 3.55%. Furthermore, in August 2016, TDC Insurance Company Ltd. (formerly SNIC) was awarded an A-minus rating, based on its Balance Sheet strength, profitability over the years, among other things, by A.M. Best, a leading international rating agency.
Indeed, a more prosperous consumer class and the release of pent-up demand – following the Team Unity government’s removal of the 17 percent VAT from food, medicines and a few other essential items in April 2015 – are helping to boost sales and profitability in the automobile industry and related sectors.
What’s more, businesses in St. Kitts and Nevis are tailoring their offerings to match the needs and tastes of the expanding middle class.
For instance, the TDC Group of Companies’ Directors’ Report 2016/2017 says that “The Directors are actively seeking opportunities to invest in suitable land for a middle-income housing development.”