Over 14,000 automobile show attendees flocked to the event within its inaugural days - AKAB
In the past 24 hours, over 14,000 Kazakhstan residents have visited car dealerships nationwide. The surge in interest can be attributed to recent updates in the preferential auto loan program, which aim to rectify issues from the initial launch in 2015.
Under the new guidelines, the following changes have been implemented:
- Loans under 10 million tenge no longer require an initial down payment.
- Waiting periods for car delivery have been shortened to 1.5 months, even for popular models.
- The mandatory insurance policy has been reduced to 0.95% of the loan amount.
- Annual insurance is now offered by the Industrial Development Fund to help alleviate financial burdens.
- The practice of installing additional equipment on cars without client consent is now prohibited.
The Industrial Development Fund is responsible for overseeing the program implementation, with client service departments monitoring for violations. Since the program's inception, complaints have predominantly centered around the lack of desired specifications (12 cases), queue length (54 cases), and stock availability (25 cases). To date, no instances of forced equipment installation have been reported.
The Association of Kazakhstani Automakers (AKAB) stresses that since March 2022, dealerships have only provided additional service with written client consent. In response to any violations, distributors encourage immediate contact with call centers.
As of May, manufacturers plan to supply an additional 8,500 cars, followed by another 8,600 in June to maintain a sufficient stock for clients under the preferential auto loan program. This measure ensures that there will be no shortage of cars for clients throughout the duration of the program.
(If relevant) The auto loan market globally is witnessing growth, particularly in super-prime lending, signifying a preference for high-quality borrowers. In neighboring Uzbekistan, regulatory changes concerning electric vehicles have been implemented, including increased recycling fees for imported electric cars. Although these changes do not directly affect Kazakhstan, they highlight the potential for regulatory changes within the region.
The new guidelines in the preferential auto loan program have resulted in the removal of initial down payments for loans under 10 million tenge and a reduced mandatory insurance policy to 0.95% of the loan amount, both being managed by the Industrial Development Fund. Meanwhile, the Finance sector in Kazakhstan might take cues from the global surge in super-prime lending, as the automotive industry experiences growth and adjustments.
