Nairobi — The ban of the importation of second-hand trucks and buses by the Kenya Bureau of Standard (KEBS) is set to increase growth and employment opportunities in the country, local motor assemblers have said.
The local assemblers say that the ban will ultimately boost revenue for the government in terms of increased taxes and eliminate the losses previously faced in terms of forex and scale by the local players.
Speaking to journalists on Tuesday, Auto Springs East Africa Chief Executive Officer Nephat Njengwa was positive that the ban which was issued in 2019 and approved by the Cabinet will see an increase in the production of vehicles and hence force many assemblers to hire more people.
The ban, according to the Government is set to regulate the age limit for vehicle importation of commercial vehicles, spark growth in local industries that supply the local vehicle assemblers, and regulate emission standards for vehicles.
“If we are doing about 10,000 vehicles we have a potential to do up to 50,000 vehicles locally. Over the next couple of years, we will see the demand going four times what we have which means we will employ more people,” he said.
The CEO expressed confidence in the local assembly industry’s potential to grow by more than 50 percent noting that demand for materials will be high.
“There will be more demand from the Original Equipment Manufacturers (OEMs), such as Isuzu, Toyota, Simba cooperation and others will buy more items locally from us and other parts manufacturers,” Njengwa stated.
Njenga noted that the standard will also see the growth of capacity for local companies that supply parts to the vehicle assemblers.
He told journalists that his company is currently operating at a third of its capacity and is seeking to operate at full capacity within the next 2-3 years.
“The current employment level is about 200 employees. In the next 2-3 years these might go to 600 employees,” Njengwa stated.
Rita Kavashe, Isuzu East Africa Managing Director, on her part, lauded the Government for supporting the local automotive sector through favorable regulation.
“The government has demonstrated beyond doubt that Buy Kenya Build Kenya will support economic growth in the country” She said, Kavashe added that the automotive sector has the potential to create 5,000 jobs more with the anticipated
Auto Springs supplies various types of leaf springs for heavy commercial trucks and buses.
Isuzu East Africa is the leading local vehicle assembler commanding a 45% market share in the trucks and buses category.