Kenya’s Import Car Market Likely to Grow

Kenya is one of the richest countries in Africa. Growing investment and increase in educated class is resulting in a budding economy.

Kenya’s GDP per capita had reached US$ 1,432 in 2015 and to grow at a CAGR of 7.5% between 2000 and 2020. This is expected to result in an increase in private consumption and among other things, drive the sales of motor vehicles. Expenditure on the purchase of cars, motorcycles and other vehicles accounted for 1.5% of total consumer expenditure in 2015 and is expected to remain relatively stable to 2025 as incomes rise. The volume of imported cars and motorcycles has been on the increase due to the availability of attractive credit from financial institutions and the rise of the middle class. There are genuine car exporters like Autoworld International who export Japanese used cars for Kenya from Japan. Japanese cars are affordable, reliable, gives good mileage and low on maintenance. Also, the parts and service shop are readily available as majority of Kenya people import Japanese cars.

According to the Kenya National Bureau of Statistics (KNBS) the volume of imported vehicles between 2003 and 2012 have grown at over 300% from 33 000 units to 110,474 units. Passenger vehicles were Kenya’s fourth largest import overall in 2014, valued at US$420 million and making up 2.3% of total imports (by value) while commercial vehicles ranked seventh, valued at US$370 million. If the current trend of 10% to 12% growth per annum on vehicle imports is to be maintained, Kenya will have five million vehicles on the road by the year 2030. Around 19,523 new vehicles were sold in Kenya in 2015, reflecting the dominance of used vehicles in the retail market. In 2015 light and heavy commercial vehicles combined accounted for 86% of total vehicle sales, the most popular second-hand vehicles cost between Ksh350000 and Ksh500000. The vehicle assembly in Kenya grew by 31.4% in 2014. High growth of 54.4%, 43.7% and 20.8% was registered in the production of pick-ups, trucks and buses respectively. Kenya’s vehicle sales are expected to double from 2013 to 2019.