The government wants to extend the deadline for used car imports from two years to five years as it gears towards promoting locally assembled vehicles.
Treasury CS Ukur Yatani, on Monday, January 25, said that the government will phase out secondhand cars by 2026. The car dealers had up to 2023 to import secondhand vehicles in an earlier plan unveiled in 2019.
The new proposal will offer them reprieve as they were to be out of business within two years. The industry rakes in approximately Ksh 60 billion annually.
Yatani tabled his proposal in the 2021 Budget Policy Statement (BPS) that was released for public participation. BPS outlines Kenya's plans for the 2021/22 Ksh 3 trillion budget.
The CS wants the motor assembly sector streamlined as second-hand cars make up more than 85 percent of the imported fully built unit (FBUs).
"The government through the Ministry of Trade and Industrialisation, drafted the National Automotive Policy to effect changes in the motor assembly industry with the ultimate goal of phasing out the importation of second-hand vehicles by 2026.
"The policy aims at spurring growth in local car assembly as it prescribes clear measures to promote utilisation of locally manufactured products, local content, innovation and research," Yatani said.
Trade CS Betty Maina added that the government had set aside Ksh600 million to purchase locally assembled or manufactured cars to boost and revive the economy crippled the by Covid-19 crisis.
On Thursday, December 10, President Uhuru Kenyatta commissioned the local assembly of Proton Saga saloon cars at the Associated Vehicle Assemblers (AVA) in Miritini, Mombasa County.
He lauded developers supporting the government's agenda to revive the local vehicle assembly industry adding that the sector would help to support wealth and employment creation for the Kenyan youth.
In January 2021, local carmaker Mobius Motors also opened a new Ksh330 million manufacturing plant in Nairobi.
Mobius Chief Operating Officer Nicolas Guibert said that at least eight units would be produced from the Mombasa Road plant daily.
