Isuzu has raced ahead of Toyota dealer in the new cars market where unit sales jumped 47.89 percent in the first quarter of the year on renewed demand for trucks and buses.
Kenya Motor Industry Association (KMI) data shows local purchases climbed to a new record of 3,298 units from 2,230 units in a similar period a year ago, largely lifted by Isuzu East Africa, whose sales surged by nearly two-thirds.
The 47.89 percent jump in sales marks a rebound from two consecutive years of falls in the wake of multiple challenges, including costly bank loans and reduced demand from corporates.
The industry sales turned around in the early months of 2025 after a tough two-year period that coincided with economic challenges such as an increase in taxes and volatility in the currency market, which made cars costly.
Expensive credit and cost-cutting measures in companies, which drive the sales, had dampened demand for showroom cars.
The shilling has since strengthened against the dollar, the cost of loans is falling and inflation has stabilised, offering relief to car dealers.
“The stable forex and inflation rates are driving optimism in the market,” Isuzu East Africa said in a response to the Business Daily. “The storm appears to be over because of the positive macro-economic indicators, with promising signs of recovery and growth.”
Market leader Isuzu East Africa recorded the largest growth in orders amongst the three major dealers and assemblers, alongside CFAO Motors and Simba Corp— which control nearly 90 percent of the new vehicle market.
Isuzu — which sells pick-ups, buses, trucks and sport utility vehicles (SUVs) — sold 1,648 units in the three months ended March 2025, a 65.13 percent growth over 998 vehicles a year earlier.
Analysis of the KMI statistics shows Isuzu sales were largely boosted by trucks and buses, which accounted for nearly three-quarters (73.60 percent or 1,213 units) of the volumes purchased from the Mombasa Road-based dealer and assembler.
The increase helped the Japanese-owned automotive manufacturer tighten its grip on the new vehicle market to 49.97 percent in the first quarter from 44.75 percent in the prior year.
CFAO, which sells multiple brands such as Toyota, Mercedes, Volkswagen and Hino under one roof following last year’s merger of Toyota Kenya and DT Dobie operations May 2023, increased sales 27.02 percent to 959 vehicles.
Its market share, however, shrank to 29.08 percent from 33.86 percent last year, the data shows.
Simba Corp, which holds a franchise for Mitsubishi, Proton, Ashok Leyland and Mahindra, also shed market share to 9.13 percent in the review period from 11.43 percent. This came despite Simba Corp growing sales 18.04 percent to 301 units.
Analysis of industry data shows first quarter sales in 2024 dropped to lows last witnessed more than a decade ago.
The recovery in sales has come at a time when the Central Bank of Kenya has piled pressure on commercial banks to lower interest rates after cutting the benchmark rate to 10 percent in the latest review, the lowest level in nearly two years.
The Kenya Revenue Authority increased the duty on shipping cars into the country from 25 percent to 35 percent from July 2023 after the East African Community Council of Ministers approved Kenya’s application to levy a higher rate than the 10 percent common external tariff (CET) for the seven-nation EAC bloc.
Importation of vehicles further attracts excise duty ranging from 25 percent to 35 percent, depending on the size of the engine, in addition to the standard 16 VAT.
Excise tax is charged on the sum of the landed cost of the car and import duty, while VAT is applied on the resultant value [the sum of landed cost, import tax and excise duty].
The William Ruto administration has prioritised incentive packages to transition the local automotive assembly industry to electric motors.
“Transitioning to electric mobility (e-mobility) remains a priority intervention of the government’s inclusive green growth and climate action plan aimed at reducing greenhouse gas emissions and air pollution while at the same time meeting the mobility needs of consumers,” the Treasury wrote in the 2025 Budget Policy Statement in February.
“Electric vehicles and motorcycles are an important breakthrough toward bettering air quality and easing traffic in busy cities because of their quiet operation and lower running costs as compared to diesel buses.”
