Used Car Importers Lose Millions Over Govt Directive

  • Motorists on a Colossal Traffic Jam Along Busy Uhuru Highway in Nairobi
    Traffic jam witnessed along busy Uhuru Highway in Nairobi in 2019
    Simon Kiragu
  • Used car importers are counting millions in losses after they were forced to sell their automobiles at discounts ranging up to Ksh200,000 per car. 

    This was after the National Transport and Safety Authority (NTSA) and Kenya Revenue Authority (KRA) directed the second-hand car dealers to assign number plates to the vehicles at the clearance points rather than when selling them. 

    Importers argued that motorists prefer new plates and registering them earlier amounts to losses as some vehicles stay in the yards for months and years before they are sold. 

    Car Importers Association of Kenya (CIAK) lamented that the government was enforcing outrageous measures to fade out second-hand cars and was favouring new car importers with the new directive. 

    Traffic snarl-up at Uhuru Highway in Nairobi in March 2020.

    "Effectively, a motor vehicle imported by franchise dealers will attract a registration number that may be much more current than an imported used motor vehicle despite the fact that they may be held by traders for the same period of time, prior to trading them," CIAK complained. 

    The association filed a suit against the government entities seeking to overturn the directive. 

    In May 2021, importers under Kenya Auto Bazaar Association (KABA) opposed a proposal fronted by Kenya Plant Health Inspectorate Service (KEPHIS) to charge them a pest inspection fee

    KEPHIS wanted importers of used cars to part with Ksh2,000, vans and minibuses Ksh3,000, buses Ksh5,000, trucks and other commercial machinery Ksh10,000. 

    They further lamented that their businesses would be extinct by 2026 when the government fades out second-hand automobiles. 

    The government extended the deadline for used car imports from 2023 to 2026 with a focus on promoting locally assembled vehicles. 

    The second-hand car industry contributes approximately Ksh60 billion per year to the economy. 

    Imported cars at the port of Mombasa await clearance.
    Imported cars at the port of Mombasa await clearance.