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Volkswagen comeback in Kenya

8. September 2016

Voklswagen makes comeback in kenya car assembly industry having stopped local assembly in the 1970s

The Motor dealer DT Dobie which took over the Volkswagen (VW) franchise from CMC Holdings is set to start assemblying Volkswagen (VW) vehicles at the Thika-based Kenya vehicle Manufactures plant.The company has been importing the fully built German vehicles from markets like South Africa.The VW South African CEO Thomas Schafer said that the German multinational will later this year start assembling some models at KVM as part of VW's Africa strategy.Mr. Schafer signed an agreement with president Uhuru Kenyatta to launch VW's local assembly at KVM where the government owns 35 percent stake whereas DT Dobie and  CMC Holdings having each 32.5 percent shareholdings. A passenger car which will be the first to be assembled locally, Light trucks and Vivo will be amongst the VW models. Mr. Kenyatta was happy to welcome the VW Group which he said is currently one of the largest car manufacturers worldwide. Until 1977 the German automaker assembled VW vans, microbuses and the famous Kombi. Vehicles parts meant for assembly plants are exempted from the 25 percent import duty contrary to fully-built cvehicles, hence a price advantage.Dealers  foresee an increament in the local productions through the recent move by the goverment to erase a 20 per cent excise tax on locally assembled vehicles.Mr. Kenyatta said his government is committed to Kenya's industrial growth through investing in infrastructure and enacting progressive policies.