Posted on :Monday , 1st March 2021

The Government of Kenya has extended the time limit for imports of used cars from two years to five years as it is geared towards the promotion of locally assembled vehicles. Treasury CS Ukur Yatani, on Monday, January 25, said the government would phase out second-hand cars by 2026. Car dealers had until 2023 to import second-hand vehicles under an earlier plan unveiled in 2019.

The new proposal will offer them the right to be out of business within two years. The industry is raking in approximately Ksh 60 billion a year. In the 2021 Budget Policy Statement (BPS), which was published for public participation, Yatani tabled his proposal. BPS outlines Kenya's plans for the budget of Ksh 3 trillion in 2021/22.

The CS wants the engine assembly sector to be streamlined as second-hand cars make up more than 85 per cent of the imported fully built unit (FBUs). 

"The Government, through the Ministry of Trade and Industrialization, has drawn up a National Automotive Policy to effect changes in the automotive assembly industry with the ultimate aim of phased out imports of second-hand vehicles by 2026.

"The policy aims to stimulate the growth of local car assembly, as it lays down clear measures to promote the use of locally manufactured products, local content, innovation and research," said Yatani.

CS Trade Betty Maina added that the government had set aside 600 million Ksh to purchase locally assembled or manufactured cars to boost and revive the economy crippled by the Covid-19 crisis.

On 10 December 2020, President Uhuru Kenyatta commissioned a local assembly of Proton Saga saloon cars at the Associated Vehicle Assemblers (AVA) in Miritini, Mombasa County.

He praised the developers supporting the government's agenda to revive the local vehicle assembly industry, adding that the sector would help support the creation of wealth and employment for Kenyan youth.

Local carmaker Mobius Motors also opened a new Ksh330 million manufacturing plant in Nairobi in January 2021. Mobius Chief Operating Officer Nicolas Guibert said that at least eight units would be produced daily from Mombasa Road.