Japanese automakers account for 80% market share in Kenya
By Soko Directory Team / Posted on September 24, 2019 | 11:25 a.m.
Although Japanese automakers have assembled vehicles in Kenya for more than three decades, no parts are currently manufactured locally. Instead, they are imported from Japan and then assembled in Kenyan factories.
Fareedh Kana, Managing Director of Honda Nairobi, explains how he wants to change this: âThe transfer of skills from Japanese to Kenyan, the importance of that is immense.
Recently on Marketplace Africa, CNN International investigated the international influence of the automotive industry in Kenya. This sector is dominated by Japanese automakers who account for 80 percent of the market share, with Japan now the fifth largest importer of goods in Kenya.
Africa is a key market for Japan and CNN meets Yuika Kubo, director of JETRO Nairobi who describes why the partnership between the two is so important: âAfrica is one of the most attractive markets for Japanese companies. , due to the Japanese economy (sic) shrinking as the population shrinks. That is why expansion is very important for Japanese companies.
Kubo points out that the industry still has a lot of potential, speaking to the program of the industry’s likely expansion: âThe market in Kenya is still small, but then in 10 to 15 years, even 20 years, we expect be more growth.
To match this, more and more manufacturers are opening local assembly factories across Kenya. Most of the vehicles assembled at these factories are commercial trucks, with commercial vehicles accounting for 80% of new car sales in Kenya.
Isuzu’s factory in Nairobi assembles up to 5,000 vehicles per year, but their president in East Africa, Eisaku Akazawa, explains that this production could be increased: âIf the customer requests it, we can assemble it. 10-11,000. If the customer has more demand, I have no problem renovating the production line to make it happen.
If come true, these predictions will translate into benefits for Japanese automakers, Kenyan auto technicians and aspiring car buyers in East Africa.
CNN is also traveling to South Africa to meet Shinkichi Izumi, Managing Director of Nissan South Africa.
Nissan recently announced an investment of $ 215 million to produce pickup trucks at a factory outside of Pretoria, and Izumi tells Marketplace Africa how this will give Nissan the ability to export new models to the African market: â For Nissan, Africa is the last frontier, we see the potential, our strength is that we have a historically strong footprint in South Africa, so our strategy is to use South African assets for the whole continent.