NAIROBI, Kenya, Nov 28 – Japanese car maker Toyota has announced plans to set up two production facilities in Mombasa as it seeks to increase its market share in Kenya.
The company is set to put up production lines to manufacture Hilux pickups and Hino trucks locally, a decision the company expects to endear it to local consumers.
Toyota Kenya Managing Director Hylton Bannon said the move is in line with a new strategy to lower operational costs by having to import the cars, as well as reduce dependency from the manufacturing plant in Japan.
“By bringing production facilities to Kenya, we will lower our costs and it will enable us to be a lot more competitive,” Bannon said.
The car manufacturer currently commands 26 percent of the new car sales market and is looking to grow this to 27 percent next year through enhanced marketing.
Kenya’s new vehicle market has shrugged off effects of the weak shilling and rising inflation to record a 7.2 percent growth in units sales, putting the sector on course to surpass its target of selling 12,000 cars this year.
Bannon however said that car dealers were being forced to come up with new and innovative ways to remain ahead in the market despite all the shocks.
“In the motor vehicle business, the golden rule in a shrinking economy is not to lose market share. We will keep working together with our partners and authorised dealers to ensure Toyota has as much presence as possible,” he said.
One way Toyota Kenya is looking to improve its performance in the market is the growth of its used car unit. With increased imports of used cars mainly from Japan and Dubai, car manufacturers and authorised auto dealers have had stiff competition to sell their vehicles.
Bannon said by enhancing that line of business, the car manufacture would ensure it is able to register high sales volumes as well improve customer experience.
“The whole of Toyota’s global objective is to ensure the customer has the best user experience and we would like to enhance that in the used car business,” he said.
Toyota Kenya will also look into shipping second hand vehicles directly from Japan.
He was speaking during the unveiling $2 million (Sh180.7 million) Toyota showroom in Westlands bringing its total number of outlets to 10. Toyota Kenya is on an aggressive expansion strategy to bring its services closer to customers across the country with branches and dealerships planned for growing economic centres.
Bannon said Toyota plans to open another one in the Gigiri area of the city at the same cost next year, to improve customer service.