Vehicle makers in tight competition to meet varied tastes of consumers

What you need to know:

  • Custom-built vehicle services, popular among Completely Knocked Down units (CKDs) assemblers, provide end-users with viable cost options where one can choose to omit non-essential components making the vehicles more affordable.
  • Availability of custom-built vehicle services in Kenya also creates a new class of affluent and business-savvy Kenyans who spend money to be noticed on the ‘road’ or ‘pimping’ their buses to attract more customers.
  • New car manufacturer, Mobius that has since sold 60 units runs an online platform where Kenyans can ‘build’ their own vehicles determining add-ons from choice of colour, alloy rims, entertainment units, air conditioning as well as the number of seats before placing an order.

The entry of Tata Motors in the locally assembled vehicles space increases Kenyans’ choices on how they want their trucks built for specific uses and tastes and how much they want to pay for the same.

Custom-built vehicle services, popular among Completely Knocked Down units (CKDs) assemblers, provide end-users with viable cost options where one can choose to omit non-essential components making the vehicles more affordable.

Availability of custom-built vehicle services in Kenya also creates a new class of affluent and business-savvy Kenyans who spend money to be noticed on the ‘road’ or ‘pimping’ their buses to attract more customers.

New car manufacturer, Mobius that has since sold 60 units runs an online platform where Kenyans can ‘build’ their own vehicles determining add-ons from choice of colour, alloy rims, entertainment units, air conditioning as well as the number of seats before placing an order.

According to Tata Africa, the price of their trucks will vary between Sh8 million and Sh10 million, but the exact price will be determined by a client’s specifications.

Tata Daewoo Commercial Vehicles President and chief executive K K Kim said they were determined to revolutionalise the commercial vehicle industry in Kenya and across the region by availing the latest global technologies while building trucks that respond to the needs of their customers.

“The Daewoo Novus is shaped by a result of customer feedback combined with years of experience in the trucking business technology, know-how and expertise,” he said last week.

Tata Africa Kenya Executive Director Naresh Leekha said assembling of the Novus range in Kenya not only benefitted the local economy but also elevated Kenya’s stature in vehicle assembling expertise.

In 2019, Kenya will also host a Mobius’ fully-fledged manufacturing plant boasting of end-to-end technology from vehicle frame fabrication, anti-corrosion treatment, general assembly, painting and final vehicle roll-out for inspection and quality testing.

The plant, which will include a research and development arm, expects to churn out 1,900 vehicles by the end of 2019.

To meet the various tastes by customers across the region, Daewoo said its production for various brands will be dictated by customer demand with locally assembled Daewoo buses expected to be rolled out within the next six months.

The CKD assembly firms include Isuzu East Africa and the Thika-based Kenya Vehicle Assemblers that has been assembling VW Vivo vehicles since last year.

French carmaker, Peugeot, started producing cars in Kenya last year, while Japanese vehicle Toyota set up operations for some models in Kenya in 2015.

In Mombasa, two locally assembled trucks rolled off the mills last week with the Tata and Daewoo setting eyes on the regional market.

The Daewoo Novas tipper and prime mover will be produced at the Associated Vehicle Assemblers (AVA) plant in Miritini.

In January, Chinese automaker Foton Motor Kenya Limited rolled out its first trucks in a move it said was aimed at cementing its place in the Kenyan market. The firm will have its trucks also assembled at the AVA plant in Mombasa.

When he spoke during the launch of the vehicles, Foton general manager Apple Sun said the company is targeting Kenya’s construction, transport and mining sector where it wants to at least have assembled and dispatched more than 100 trucks in the first year of the deal.

“Our trucks being the best sellers, we want to have dispatched at least 300 trucks. The Kenyan market predicts a bright future for the motor industry,” he said.

Mr Sun said the launch is a realisation of the ‘one belt one road’ initiative started in 2013.

“As practitioner of the initiative started by the chairman of China Mr Xi Jinping, Foton Motors set a long term strategic plan in Kenya and Africa. Today we have officially realised the localisation of our main value factors,” Mr Sun said during the launch in January.

The AVA assembly plant in Mombasa is one of the three largest CKD assemblies for some internationally motor brands such as Toyota and Scania.

The company intends to cash in on China’s growing influence in the East Africa region to open a local assembly line.

“Foton eyes to penetrate into East Africa community and Comesa free trade zone through its CKD assembly located in Kenya in the near future,” he said.

Tata Daewoo Commercial vehicle president and CEO Kim Kwan-Kju and Tata International executive director Nareesh Leekha attended the launch of the new assemblies last week and said they are ready to rule the local market.

Mr Leekha said the decision to assemble the vehicles in Kenya was informed by the need to meet increasing demand for Daewoo trucks. He said the demand for Daewoo trucks is supported by both the construction and transport sectors.

The decision, he added, was also swayed by various incentives offered by foreign firms that assemble their vehicles locally.

“This is one of our biggest investments (in Africa) after South Africa,” said Mr Leekha.

The vehicles will be available for the local market and for export to neighbouring countries.

The plant is currently assembling 54 vehicles – six tippers and 48 prime movers.

“Our plan is to achieve 100 per cent of vehicle assembly to be here in the near future. We are currently in the process of assembling Daewoo buses and the first fleet will be out in the next six months,” said Mr Leekha.

Mr Kwan-Kju said the launch of the assembly line marked an important turn in the company’s expansion in the Kenyan market. More than 20,000 Daewoo trucks are operating in 40 countries, with Kenya, South Africa, Tanzania and Algeria being the leading markets, according to the automaker.

“The Novus V3T6F and K6D6F extends the Daewoo brands foray into the multi-axle Prime Mover and Tipper category with a GVW of 40 to 55 tonnes, come with a high performance Doosan 12 liter 340 BHP,” Mr Kwan added.

The Tata Daewoo Commercial Vehicles company manufactures and sells a wide range of medium and heavy-duty trucks starting from Euro 1 and going up to Euro 6, the highest emission norms in the world, employing 2,000 employees directly and about 5,000 indirectly. Company also has assembly operations in South Africa, Algeria, Vietnam, Philippines, Russia and Pakistan.

Daewoo Trucks was introduced in East Africa in 2006 with operations in Kenya and Tanzania. The products were selected keeping in mind the local customer requirements and operating conditions. The products have stood the test of time and have proved to be lowest in Total Cost of Ownership.