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GM records 27pc rise in car sales

NAIROBI, Kenya, Jan 7 – General Motors East Africa (GMEA) has announced a 27 percent increase in the number of new cars sold in 2010 despite the threat posed by undervalued second hand imports. 

The company\’s domestic volumes rose to 2,680 in 2010 from 2,057 recorded in 2009 while exports rose from 322 in 2009 to 377 in 2010, figures which represent an all time high for the manufacturer.

The firm\’s chairman and CEO Bill Lay attributed the growth levels to a public-private partnership (PPP) involving GMEA and several firms such as the Ministry of Co-operatives Development and Marketing, Co-operative Bank of Kenya, Invesco Assurance and the Matatu Owners Association (MOA).

Last year, the parties launched a country-wide campaign dubbed \’Vision PSV 2030\’ that has generated significant grassroots support for the locally assembled Isuzu vehicles.

The campaign sought to promote the use of high capacity buses in major cities across the country through the formation of investment groups which can realise substantial efficiencies and economies of scale through centralized management and administration.

Mr Lay said the company is set to scale up local assembly operations to satisfy the increase in demand for higher capacity buses as the government moves to improve the safety and efficiency of PSV transport including the phasing out of 14-seater matatus which began last week.

"We expect this year to be better because appropriate infrastructure will be in place, the rule of law is now taking effect, while the Government continues showing commitment to engage with the private sector to improve the industry," said the CEO. 

However challenges facing local motor vehicle assemblers still abound including access to East African Community markets and the continued flood of second hand vehicles into the region. 

GMEA has however welcomed the government\’s move to direct the Monopolies and Prices Commissioner to establish factors inhibiting the growth and efficiency in the motor vehicle sector and subsequently recommend measures to mitigate against them.

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"We are happy to engage with the Government and offer GM\’s international experience of working with policy makers to develop a sustainable auto industry which will also support the government\’s industrialisation policy," Mr Lay said.

He pointed out that they would draw on its parent company\’s success in engaging with governments like Egypt, South Africa and Colombia in growing the auto industry and streamlining the PSV sector.

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