Motor CEOs Pressure Govt to Increase Car Import Fees

  • Imported cars at the port of Mombasa await clearance.
    Imported cars at the port of Mombasa await clearance.
  • Chief Executive Officers (CEOs) of motor companies operating in Kenya have demanded an increase in duty fees for second-hand cars in the country.

    A report by People Daily on Thursday, March 4, indicated that the executives were calling for the implementation of the national automotive policy that has been gathering dust for three years.

    The CEOs of the local motor assembly companies are also demanding that the age limit of car imports coming into the country should be lowered from eight to five years, in line with the policy which aims to shift the demand of cars by Kenyans to locally assembled vehicles.

    Used cars yard.
    A used cars yard.

    Simba Corporation Motor Division Managing Director Naresh Leekah noted that the policy is still in parliament and the delay has immensely affected their businesses.

    “It is something we are still waiting for, because as far as we are aware, it is not yet approved and I think it is still at the Parliament stage,” stated Leekah who is also the Kenya Motor Industry Association chairperson.

    The document was drafted by Kenya vehicle manufacturers and other stakeholders including car companies but the delay is believed to have been caused by differences between the local assembly plants and second-hand car importers.

    Toyota Kenya MD Arvinder Reel observed that the approval of the policy would boost the Buy Kenya Build Kenya campaign when incentives such as lowering high costs of additional taxes, charges, levies as well as logistical charges are also implemented.

    “We are still hopeful of having it implemented soon for reasons we believe will go along away in protecting local assemblers while at the same time promoting the Buy Kenya Build Kenya Initiative,” stated Reel.

    Kenya Auto Bazaar Association Secretary Charles Munyori, on the other hand, confirmed that the importers had also made recommendations to the drafters of the policy on the basis that the age limit will remain unchanged until the country can comfortably assemble many cars.

    “We are, however, optimistic that the policy will be ready at the time of budget reading,” stated Munyori.

    The car assemblers decried unfair competition from the importers and demanded that the state should guarantee a tariff-free regime for some vehicle parts being produced in the country.

    So far, imported second-hand vehicles account for 85 percent of Kenyan car purchases. A report by Kenya National Bureau of Statistics showed that imported cars accounted for Ksh22 billion in the first three months of 2020.

    A sitting in session at Parliament Buildings in June 2020.
    A session in progress at Parliament Buildings in June 2020.