Jeffery Oppong Preprah addressing the media
CEO OF Volkswagen Ghana, Jeffery Oppong Preprah has announced the company’s collaboration with the government and the Automobile Association to develop a financial framework aimed at introducing incentivized loan options with lower interest rates to enhance vehicle affordability in Ghana.
Speaking at the launch of Volkswagen Toureg in Accra, Mr. Preprah highlighted the challenges faced by consumers in the predominantly cash-based automotive market. “Many consumers save for extended periods to purchase vehicles outright, which often leads to a higher demand for used cars. This trend underscores a significant challenge: affordability,” he stated.
Currently, interest rates for vehicle loans hover around 24% or more, which Oppong Preprah described as “too burdensome for the average Ghanaian.” He emphasized the need for a more accessible financing model that would empower more people to purchase vehicles.
The CEO confirmed that significant progress has been made in reducing vehicle costs through local assembly, which alleviates some import taxes. However, he stressed that to truly increase purchasing power, there is a need for vehicle financing solutions that allow consumers to spread their payments over a longer term.
This approach, he noted, would not only drive sales volume but also benefit families across the country. While acknowledging the strides made in classifying salvage vehicles with the Customs Standard Board, Mr. Oppong Preprah pointed out that challenges remain, particularly concerning affordability and the influence of informal market players.
He urged the government to develop policies that gradually reduce the influx of salvage vehicles while simultaneously supporting local production. “By purchasing locally assembled vehicles, consumers can benefit from reduced costs—often over 30%—compared to imported cars,” he explained.
“Additionally, these vehicles come with warranty histories and thorough inspections, providing peace of mind that is often lacking with imported used cars.”
Focusing on local assembly and production, he asserted, would not only improve the quality of vehicles on Ghanaian roads but also contribute positively to the environment by reducing CO2 emissions.
He also addressed concerns regarding potential job losses in the informal sector due to a decrease in salvage vehicles, assuring that ample opportunities would still exist for local technicians and mechanics within the evolving automotive landscape.
“In Ghana, we have an opportunity to enhance our automotive sector. Currently, an average vehicle consists of approximately 80% components that can be localized. By manufacturing these parts domestically, we can create additional jobs and stimulate industrialization within our country,” he said.
He further highlighted the availability of raw materials necessary for this endeavor and stressed the importance of relocating industries closer to these resources to maximize efficiency and reduce costs.
“We are committed to working closely with the government and relevant ministries to address outstanding issues, such as taxes and other regulatory frameworks that impact our industry,” he added.
BY Prince Fiifi Yorke