Mechanical Llyod Company, a Ghanaian auto importer and dealer is giving up its franchise with British car maker Land Rover at the end of November this year, its director said.
Mr Terence Darko, Managing Director of MLC, told brokers at the 'Facts Behind the Figures' series of the Ghana Stock Exchange that the decision to stop marketing Land Rover was as a result of low return on investment and competition from cheaper vehicles.
"Land Rover is a premium and expensive vehicle and very difficult to sell," Mr Darko said.
He said MLC customers and shareholders, as well as Land Rover had been informed about the decision.
Mr Darko said there were plans to take on Chinese-made vehicles in response to demands from customers within the lower income bracket.
He said the Company would be guided by its reputation and performance of its flagship BMW and Ford vehicles in choosing a robust Chinese manufactured vehicle to satisfy the market.
Mechanical Llyod, which also distributes and markets farm machinery, posted a 33 percent increase in profit before tax in the first half of 2008 from GH¢900,000 to GH¢1.2 million.
Total assets also increased by 40 percent to GH¢22 million, from GH¢15 million.
Mr Darko attributed the improved performance to increased sales in Ford vehicles and the improving economy, making it possible for Ghanaians to acquire new vehicles.
However, the market was still dominated by used cars, he said.
Available figures show that about 8,000 new vehicles were sold in 2007, compared with 25,000 used vehicles.
This notwithstanding, the records show that there is growing sales of new vehicles due to the introduction of cheaper brands from China and India.
Mr Darko said the company would continue to manage operational cost and adopt strategies to increase sales and double its turnover by 2012.