M a r k e t N e w s

Incentives to attract investment in Kenya's automotive industry

Posted on : Monday , 3rd October 2016

 Kenya's removal of excise duty on locally assembled cars will boost the industry, but the government must make power supplies cheaper and address other concerns to draw more investment, the automobile industry association chief said on Thursday.

With little growth in mature markets, automakers are looking to tap into emerging African markets, but there is plenty of competition on the continent for where they might invest.
Kenya's East African neighbour Ethiopia, for example, is building an assembly industry and boasts rapidly improving transport links and plentiful, cheap hydro-electric power.
Kenya currently mostly assembles trucks, pick-ups and buses from kits supplied by foreign manufacturers. Some 2,258 vehicles were assembled in the first four months of this year, the statistics office said.
However Volkswagen said this month it would resume car assembly in Kenya after closing a plant in the 1970s.
Rita Kavashe, the chairwoman of the Kenya Vehicle Manufacturers Association (KVMA), said scrapping excise duty offered an incentive to investors in Kenya, where economic growth of 6 percent a year is helping drive vehicle demand.
"We are anticipating now an increase in purchases of motor vehicles as a result," she said, although the slow start to the year meant sales of both imported and locally assembled vehicles would be 14,000 in 2016 compared to 19,500 last year.
But she told Reuters the government had to address other issues that deterred manufacturers, by making electricity supplies cheaper and more reliable and improving efficiency at Mombasa port, a heavily congested regional trade gateway.
"Cost of electricity has not gone down at all ... The cost is still very high in Kenya so that is a real challenge that needs to be addressed," said Kavashe, who is also head of General Motors East Africa, a big assembler in Kenya.
Sales of locally assembled cars plunged 30 percent in the first six months of this year, partly due to the excise duty introduced in January at a flat rate of 150,000 shillings ($1,483) on each assembled vehicle.
The government reversed that decision this month saying it wanted to foster local assembly of vehicles, in which kits supplied by foreign brands are bolted together.
Kavashe said investors also needed reassurance about next year's election in Kenya, a nation that has long suffered from political strife.

Source : www.cnbcafrica.com
Featured Companies
  • Bajaj Auto
  • Nissens A/S
  • Bajaj Auto
  • Tire Group International, LLC.
  • dubaiexporters.com
  • Steelmate - Think safety think Steelmate

Complete List  

Advertisers in previous issue:

  • Rolman World is one of the largest and most established distributors of bearings and related technical services in the Middle East and Africa.
  • Yellow stone diesel-One of the leading manufacturers of engine parts.
  • TOMAD International, Inc. is an export management company specializing in sales and marketing within the Middle East and Africa region.
  • GARAGE 1 has been purchasing cars, trucks and jeep in order to recuperate esclusively top quality used complet engines, gearboxes and mechanicals parts.
  • Dealers of Honda,Yamaha,Suzuki.
  • Product includes Braking, Steering, Suspension, Filtration, Transmission, Cooling, Heating, Electrical, Engine, Lubricants, Chemicals, Wiping, Lighting etc.
  • FM Filter Monza can respond to this need with a wide range of ready or customized filters, manufactured using different technological solutions.
  • Our products are widely used and serviced for passenger car,truck,tractor,agricultural & earthmoving machines,stationary & marine engine.
  • Changzhou Guoshi Vehicle Accessories Co.,Ltd. is proficient in vehicle spare parts manufacturing and has involved a lot of capital, time and resources to make us prominent in this industry.
  • Cylinder heads
  • Global Auto Parts is an Automotive Aftermarket spare parts wholesaler offering genuine quality aftermarket replacement parts for all makes and models of passenger cars, light commercials vehicles, trucks and trailers.
  • Kenya
  • Specialized in development, design, manufacture and sale of steel wheel of the truck and trailer and bus,etc.
  • Al Maroof Trading Company is one of the leading Auto Parts Dealers based in UAE and Pakistan.
  • Nordic Trailers Ltd we pride ourselves on importing and selling world leading car trailers from Respo.
  • Exporters of Genuine & Non Geuine Parts for Japanese Cars.
  • The Bajaj Group is amongst the top 10 business houses in India. Its footprint stretches over a wide range of industries, spanning automobiles (two-wheelers and three-wheelers), home appliances, lighting, iron and steel, insurance, travel and finance.
  • Manufacturer of extensive range of clamps, connectors and fasteners.
  • Auto Parts
  • Car garage equipment
  • Boston Garage Equipment Ltd is a leading suppliers of a superb range of vehicle workshop equipment.
  • Gear Gremlin is a completely new collection of indispensable accessories for motorcyclists, covering everything from a valve dust cap to a chain breaker and riveting kit.
  • Pro Media is established by a group of advertising sales people who have had over 25 years of experience in Taiwan’s two-wheeled industry.
  • Our corporation is an important motorcycle production base in southern China.
  • Bearings
Afrotrade International Marketing, Tel: +971-50-6285684
© 1998-2021 Afrotrade