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Vehicle assemblers raise output 50 percent in Q1

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Vehicle assemblers raise output 50 percent in Q1


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Workers at the Isuzu East Africa Vehicle Assembly plant on Mombasa Road during December 2018 media tour. PHOTO | DIANA NGILA | NMG

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Summary

  • Data from the Kenya Motor Industry Association (KMI) shows that the formal dealers including Isuzu East Africa, Toyota Kenya and DT Dobie assembled a total of 1,979 units in the review period compared to 1,319 units a year earlier.
  • Overall new vehicle sales stood at 2,867 in the review period, with an increasingly larger share of them being put together locally, led by trucks.

The number of motor vehicles assembled locally jumped 50 percent in the first quarter ended March to account for 69 percent of all new auto sales.

Data from the Kenya Motor Industry Association (KMI) shows that the formal dealers including Isuzu East Africa, Toyota Kenya and DT Dobie assembled a total of 1,979 units in the review period compared to 1,319 units a year earlier.

Overall new vehicle sales stood at 2,867 in the review period, with an increasingly larger share of them being put together locally, led by trucks.

Most of the vehicles are assembled at plants such as Isuzu, Kenya Vehicle Manufacturers (KVM) and Associated Vehicle Assemblers (AVA) and are sold in the local market.

A small fraction of the production is exported to neighbouring markets like Uganda.

Assemblers enjoy an exemption from 25 percent import duty on completely knocked down (CKD) parts headed to assembly lines.

The policy is aimed at boosting manufacturing jobs besides enhancing skills transfer.

The incentive has mostly benefitted the commercial vehicle segment –pick-ups, buses and trucks that are bought by the government and businesses.

Most passenger cars are imported fully-built new or used from overseas due to lack of local assembly of many models besides a preference for cheaper second-hand units.

Local assemblers now produce nearly 20 models including buses, trucks, pick-ups and passenger cars such as Peugeot 3008 (SUV) and 508 (sedan).

Production and sales numbers of Peugeot are, however, not reported by the local franchise holder Urysia Limited.

Isuzu, the largest assembler, produced 1,144 of its namesake vehicles in the review period, representing a 49.7 percent rise from 764 the year before.

It was followed by Simba Corporation which assembled 377 of Mitsubishi, Mahindra and Proton passenger cars and commercial vehicles, a 37.5 percent increase compared to 274 a year earlier.

The dealer assembled seven units of the budget Malaysian car Proton which it introduced in the market in February this year at prices starting from Sh1 million.

The Proton cars are being assembled at the dealer’s AVA plant in Mombasa.

Toyota Kenya’s assembly production across its namesake and Hino models stood at 313, an 86.3 percent jump from 168.

Assemblers of commercial vehicles got a further boost in 2019 when the government introduced a ban on imports of used trucks with load capacities of 3.5 tonnes and above.



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