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Government banks on streamlining the local vehicle assembling sector

Industrialization, Trade and Enterprise Development Cabinet Secretary (CS) Betty Maina has said the government was committed to creating an enabling environment to promote trade for local and international investors.

Maina said the government has introduced several policy measures to ensure that the motor industry in Kenya operates in a favorable environment aimed at expanding the sector.

The CS was speaking at the Associated Vehicle Assembling (AVA) Plant at Miritini in Mombasa during the unveiling of a Toyota Hiace assembly line of 16 seater vans by Toyota Kenya.

Maina affirmed that the government was banking on the automotive policy to streamline the local vehicle assembling sector. “We want to see more of the spare parts produced locally so that you don’t have to import everything because we have the capacity and human resource,” added Maina.

She said the government will continue to promote local assemblers by buying the vehicles locally, in line with the Buy Kenya Build Kenya spirit. “The government decided to buy locally assembled vehicles in order to promote home-grown manufacturing,” said the CS.

Maina said the President confirmed that the government will set aside an initial investment of Sh600 million for the purchase of locally manufactured vehicles to encourage and sustain the operations of local motor vehicle manufacturers, and generate more jobs.

She added, “The Government continues to promote market access through preferential procurement of locally assembled vehicles.” 

Toyota Kenya Chief Operating Officer, Joshua Anya, said the local assembly targets to produce about 500 units annually as it seeks to expand its market share in the public transport.

Anya said the cost for one unit will go for between Sh4 million and Sh4.5 Million and that the production will significantly address the deficit in the local market.

He noted that the new assembly line will create about 1,500 jobs within Mombasa County, adding that the vehicles are assembled at the plant then distributed to various outlets for selling.

“This demonstrates our commitment to grow the automotive sector and increase locally assembled units,” he said.

“The key reason we needed to have an assembly line specifically for the Hiace is to cater for the growing demand in the country. The Toyota Hiace comes with an engine capacity of 2.5 litres and automatic transmission,” added Anya.

According to the Toyota Kenya officer, the vehicle provides a fatigue-free driving experience on long journeys thanks to the advanced design of its seats and also meets the safety requirements, particularly with driver and passenger airbags.

The Automotive industry in Kenya has the capacity to produce over 34,000 vehicles per annum, which according to CS Maina is enough to satisfy the local vehicle demand.

However, the assembly plants are currently producing a paltry of 10,000 units, which is just less than 30 percent of the production capacity.

According to the 2021 Economic survey, the locally assembled units are currently at 7,725 compared to the 1980’s where the industry was producing over 13,000 vehicles per year.

By Mohamed Hassan

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