Lebanon's used car market is on the verge of collapse, said a local industry leader, as the country's financial woes, have forced about 70 percent of the dealers out of business.

"The market has been facing a blow since the beginning of the economic crisis in 2019," said Elie Azzi, head of Lebanon's Syndicate of Used Cars Importers.

"Political and economic stability is essential in our business," he explained.

Samer Jannoum, manager at Smart Auto services, a company importing and selling used cars, told Xinhua that demand for used vehicles in his company in particular and the whole industry, in general, has dropped by about 70 percent since 2019.

He attributed the drop to people's low purchasing power and the absence of loan facilities available to customers in the past.

More than 80 percent of the Lebanese population has been plunged into poverty amid the country's deep financial crisis, according to the United Nations.

"A lot of used car dealers either shut their businesses or merged with others to survive the crisis," Jannoum said.

Azzi said the market slowdown also affects other car-related businesses along the chain, such as paintwork, maintenance, and spare parts selling.

"It's a pity to see such an industry collapsing as it constitutes a rich source of revenues for the state's treasury, providing about 600 million U.S. dollars annually," said Azzi.

The industry used to employ about 40 percent of the Lebanese population, he added.

Adding to the industry's many existing challenges, Lebanon's vehicle registration center only reopened recently after a two-month closure because of a public sector strike, preventing car buyers from registering their cars.

Another worry for the car deals is that the government plans to hike the exchange rate of customs transactions for imports later this month to 20,000 Lebanese pounds per one U.S. dollar from the current 1,500 pounds, Lebanese Broadcasting Corporation International reported Tuesday, citing ministerial sources.

Azzi said such an exchange rate will cause a total collapse of the industry as people cannot afford a price hike amid the current crisis.