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Cars with engine capacities of 1.5 litres and below will be spared from the plan to reduce the age limit of vehicle imports from eight to five years starting July.
The change shows that the government has softened its stance on the proposed rule, which has generated heated debate among players in motor vehicle sales.
“By 2020, we will not have importation of vehicles above 1500cc older than 3 years. If you need such a vehicle, you will buy a new one.” Trade, Industry and Cooperatives Cabinet Secretary, Peter Munya said.
The Cs on Thursday said the change in the proposed policy will ensure that the middle class is not priced out of the car market.
In the long-term, the age limit and emissions control are intended to boost the rising Kenyan vehicle assembly industry by encouraging purchase of locally-made cars.
“You (will) continue to import vehicles that are eight years old if they are 1,500 cc. That will not change, for now,” Mr Munya said in an interview.
He continued to state that those who want to import vehicles with higher-capacity engines “will be able to absorb the impact of higher prices and taxes” on the five-year models.
Among the models that will benefit from maintaining the status quo are Mazda Demio, Subaru Impreza, Toyota Vitz, Nissan Note and Toyota Rush.
In the long-term, the age limit and emissions control are intended to boost the nascent Kenyan vehicle assembly industry by encouraging purchase of locally-made cars.
However, he said those who want to import vehicles with higher-capacity engines “will be able to absorb the impact of higher prices and taxes” on the five-year models.
They will also have the choice of buying smaller cars if they become price-sensitive.
Newer vehicles cost more to buy from overseas markets such as Japan, with the units also attracting higher taxes since the custom value forms the basis for a series of cumulative levies.
“Prices will rise even higher if the proposed age limit is implemented because newer models are fewer and sellers in Japan and other markets will respond to increased demand by raising prices,” said the secretary-general of Kenya Auto Bazaar Association, Mr Charles Munyori.
Mr Munya said the changes are intended to boost local motor vehicle assembly, terming it a priority sector under the government’s Big Four agenda and also at the East African Community (EAC) level.
Volskwagen and Peugeot are the latest automakers to begin limited assembly of their cars in Kenya, with new vehicle dealers having lobbied the government for years to curb importation of used vehicles.
One of the bodies that needs to be involved in making the changes is a technical committee whose membership includes the transport ministry, Kebs, insurers and motor vehicle dealers.
Official data shows that Kenya imports an average of 7,600 vehicles per month, with the average assembled units standing at about 430.
Assemblers mostly produce commercial vehicles such as buses and pick-ups, with their range of passenger cars severely limited.
According to Car Importers Association of Kenya (CIAK) chairman, an average of over 24,123 used cars are imported into the country per month amounting to Sh13.5 billion in revenue for the government.
