Last year, Kenyan new car dealers increased their shipments to the regional market.
According to data from the Kenya Motor Vehicle Industry Association (KMI), the businesses led by Isuzu East Africa and Scania East Africa sold 387 units to foreign markets in the fiscal year ending December.
This was an increase from 193 units the previous year. During the period under review, most exports went to Tanzania (which purchased 241 units) and Uganda (146 units).
Most of the exports were commercial vehicles -pick-ups, lorries, and prime movers, and most were produced locally. The top-selling export model is a Scania prime mover from the P360 series, which moved 40 units last year.
The official dealers have stated that their factories are working at less than total capacity, but they can ramp up output to satisfy regional demand.
CEO of Isuzu East Africa Rita Kavashe stated, “Our capacity utilization currently is about 40 percent where we are producing about 5,000 trucks. We have the capacity to scale up regionally in terms of production capability.”
He added, “the East Africa market size is about 200,000 vehicles annually. Out of this, 40,000 are commercial trucks and pick-ups. So, while in Kenya we assemble about 11,00 vehicles, in the region there is a big opportunity. We have three plants in Kenya and they are operating at 40 percent of their capacity.”
Speaking further on Kenya’s capacity to enhance the automobile industry in all of East Africa, Rita Kavashe noted that Kenya’s vehicle plants are capable of supplying the entire East African market.
“These three plants have the capacity to supply commercial trucks to the entire East African region. Uganda and Tanzania with less stringent age limits similarly have second-hand imports comprising approximately 85 percent of their motor vehicle sales each year,” Rita Kavashe stated.
The government has been implementing incremental incentives to promote the local automobile assembly sector, the majority of which are tax exemptions, such as the 25% import tariff.
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