General Motors East Africa (GMEA) has today announced that the firm’s 2010 sales increased by 27 percent from 2379 to 3017 units representing an all time high for the leading manufacturer  in an  industry that continues to be dogged by overaged, undervalued  second hand Mitumba imports.

The company’s domestic volumes rose to 2,680 in 2010 from 2,057 recorded in 2009 while exports rose from 322 in 2009 to 377 in 2010.

The firm’s Chairman and CEO , Mr. Bill Lay attributed the growth levels to a public-private partnership (PPP) involving GMEA, the Ministry of Co-operatives Development and Marketing, Co-operative Bank of Kenya, Invesco’s Assurance and the Matatu Owners Association (MOA) in a country-wide caravan campaign dubbed  ‘Vision PSV 2030’ that has generated significant grassroots support for the locally assembled Isuzu vehicles.

The PSV Vision 2030 seeks to encourage the formation of investment groups as opposed to individual ownership encouraging the pooling of resources to purchase higher capacity buses. This will enable PSV investors to realize substantial efficiencies and economies of scale through centralized management and administration.

Mr. Lay said the company is set to scale up local assembly operations to satisfy the increase in demand for higher capacity buses as the Government moves  to improve the safety and efficiency of PSV transport  including the  phase out of 14-seater matatus which began last week.

“We expect this year to be better because appropriate infrastructure will be in place, the rule of law is now taking effect, while the Government continues showing commitment to engage with the private sector to improve the industry,” said Mr. Lay.

There are many challenges facing local motor vehicle assemblers including access to EAC markets and the continued flood of second hand vehicles into the region.  On balance, the announcement by the Government to support preferential procurement of locally assembled vehicles will also assist to fill the un-utilized capacity at the 3 Kenyan auto-assembly plants. 

The company last year increased its workforce to meet the increased business demands and will be going back to the market to offer additional employment opportunities to Kenyans.

GMEA welcomed the Government’s move vide Gazette Notice Number 15890 dated December 10th 2010 where the Deputy Prime Minister and Minister For Finance directed the Monopolies and Prices Commissioner to establish factors inhibiting the growth and efficiency in the motor vehicle sector and subsequently recommend measures to mitigate against them.

“We are happy to engage with the Government and offer GM’s  international experience of working with policy makers to develop a sustainable auto industry which will also support the Government’s  industrialisation policy. GM has had success in engaging with Governments like Egypt, South Africa and Colombia in growing the auto industry and streamlining the PSV sector.

GAROWE ONLINE