NAIROBI, Kenya, Jun 29 – The Government has restated that it will review rules for vehicles that will block importation of cars older than five years from the current eight.
Without giving timelines, Industrialization Cabinet Secretary Adan Mohammed says the move is aimed at boosting local car makers and is subject to consultation with industry players and consumer groups.
This is despite calls by second-hand vehicles traders to review the stance.
Last month, Car Importers Association of Kenya (CIAK) said the decision to reduce the age limit will lead to a drop in government revenue and increase the cost of used cars by up to 50 percent.
Mohammed says the government in conjunction with the industry players is working on a policy that will not hurt the used car consumers and market while at the same time attract investment in the manufacture of new vehicles.
“Less than 10 percent of 90,000 or so vehicles that are imported consist of new vehicles due to significant cost advantage of the second hand vehicles for which there has been a lot of preference, making it difficult for investors in the new vehicles,” said Mohammed during the opening of the 15th edition of the Total Motor Show.
The Government’s decision is informed by an East African Community report that recommends slashing of the age limit for imported cars to five years by 2021, in a raft of measures intended to promote local assembly in the region.
The EAC report argues that the disjointed policy on age limits among the EAC member states is aiding flooding of the regional market with old cars and stifling the growth of new car manufacturing.
According to CIAK on average over 24,123 used cars are imported into the country per month amounting to Sh13.5 billion in revenue for the government.