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Nissan to Set-up Shop in Kenya in a Bid to Conquer East African Market
Nissan has embarked on their plans to assemble vehicles in Kenya, amidst a concerted effort by the Kenyan administration to make Kenya the hub for automotive manufacturing activities in East Africa. This news has been seen a major boost for the Kenyan government.
The Japanese giants are only the latest in a long list of auto-manufacturers who have turned their attention to the Kenyan market, in a list that includes names like Volkswagen AG, PSA Peugeot and CNH Industrial NV over an 18 month period.
In the present scenario, automotive manufacturing on the African continent have been limited to South Africa mainly because of challenges faced such as the sheer volume and popularity of imported used cars, limited vehicle-financing options and a less than impressive road network.
Nissan will initially put together pick-up trucks from semi-knocked-down kits, or SKDs, if the government agrees to waive a 25% import tax, according to Jim Dando, director of Africa operations for Nissan.
“We’re prepared to enter Kenya as an SKD assembler,” Dando said by phone from Pretoria. “We’re keen to move quite fast. We want to make this happen.”
The company would work at an established plant, which would cost it about $20m, rather than setting up its own facility, Dando said.
On completion, this plant is expected to carry a bulk of the manufacturing activities in East Africa and will provide the automotive market with a steady flow of automobiles. Nissan will however face considerable opposition from vehicular imports from South Africa and Japan which currently dominate the market.