Ruto's Plan To Cut Down Car Imports In Deal With Japan's Toyota

President William Ruto has announced that his administration is planning to reduce the importation of used cars through a new deal he struck with Japan's Toyota Tsusho Corporation, the trading arm of the Toyota Group.

The Head of State announced in a statement on Wednesday, February 7 that this would be achieved through Toyota setting up a vehicle manufacturing plant in the country to boost the volume of vehicle brands and models assembled locally.

Ruto who is currently in Japan noted that the deal will bolster the growth of the automotive sector and reduce the country's overreliance on used cars.

Imported vehicles parked at a yard in Mombasa. /THE STAR

"We are engaging the Toyota Tsusho Corporation to consider setting up a vehicle manufacturing plant in Kenya to tap into the growing demand for its products. The manufacturing project would reduce the number of used vehicles we continue to import and create jobs for our skilled manpower.

"I am glad that Toyota Tsusho Corporation finds the project viable. We undertake to provide sufficient incentives to multinational automotive manufacturers to set up in Kenya," he revealed in part.

Ruto was in Tokyo where he witnessed the signing of the Framework Agreement For Collaboration between Kenya and Toyota Tsusho Corporation and later toured the Toyota Motamachi Factory.

To fast-track the project, Toyota Tsusho Corporation committed to fund the Thika Vehicle plant with Ksh800 million. Currently, locally assembled vehicles accounted for the bulk of new vehicles sold in Kenya from January 2023 to July 2023.

Furthermore, almost 80 per cent of Kenya's vehicles are imported from different countries including Japan. Most of the cars are used before being imported by different car dealers.

The Japanese company also pledged to support President William Ruto's plan to increase electric vehicle uptake in the country.

Toyota has been manufacturing hydrogen-powered cars since 2014, using fuel cell technology, and the move would see the promotion of Hydrogen Electric Vehicles in line with Kenya's push to attract firms that have already adopted the new technology to cement its bid to transition into renewable energy.

Moreover, the company announced a bid to fund various projects in the country, in a comprehensive pact.

"The pact entails Ksh15 Billion Meru Wind Farm Energy, Ksh8 Billion Isiolo Solar Energy, Ksh800 Million Thika Kenya Vehicle Manufacturers' initial investment, Ksh75 Billion Menengai Geothermal Plant and Electrified Vehicles promotion," he added.

Transport Cabinet Secretary Kipchumba Murkomen and his Treasury counterpart Njuguna Ndung'u witnessed the signing of the agreements among other delegates who accompanied the President to Japan.

From left to right: CS Rebecca Miano (Trade), Ichiro Kashitani, president and CEO of Toyota Tsusho Corporation, Davis Chirchir (Energy) and Kipchumba Murkomen (Transport). /PCS