The Automotive industry in Kenya is primarily involved in the retail and distribution
of motor vehicles. There are a number of motor vehicle dealers operating in
the country, with the most established being Toyota (East Africa), Cooper Motor
Corporation, General Motors, Simba Colt and DT Dobie. There are also three vehicle
assembly plants in the country, which concentrate on the assembly of pick-ups
and heavy commercial vehicles.
The established dealers face intense competition from imported second-hand
vehicles, mainly from Japan and United Arab Emirates. These imports now account
for about 70% of the market. The last decade witnessed a significant decline
in the number of new vehicles sold in the country. There has been a steady recovery
in the last four years, but the numbers achieved still fall far short of the
numbers recorded a decade ago. In 2004, the leading motor vehicle companies
recorded sales of 9,979 units. Although 27% better than the previous year, this
is still well below the levels achieved in the early 1990’s.
The slump in the volume of new cars sold is attributable the increased competition
from second hand vehicles and the depressed economic environment.
The Kenya Motor Industry Association (KMI), the representative body of the
corporate participants in the motor industry, has been lobbying hard to reverse
this trend. Some of these measures have helped the industry recover from its
lowest point in 2000, when only 5,869 units were sold. On their part, the companies
themselves have become more innovative in responding to customer needs. Some
of the measures that KMI has been advocating include:
- Implementation of strict criteria on importation of second hand vehicles
- Incentives to promote local assembling of commercial vehicles
- Export incentives aimed at encouraging car manufacturers to expand operations
in the region.
PricewaterhouseCoopers provides services to major companies in the Automotive
sector in Kenya and the East Africa region.
