MaxShimba
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- Apr 11, 2008
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Visitors view a Chery Fulwin II at the Beijing International Automotive Exhibition. China's Chery Automobile is planning to build a n assembly plant in Kenya. REUTERS
"They (Chery) are discussing with the (Chinese) government so that they can get some $50 million to invest in Kenya through an assembly plant," said Mr Justus Nguu, the director of Stantech Motors, the Kenya franchise holder of Chery.
China has made big inroads in Africa, where it is seeking to secure energy, minerals and food and their quest to set assembly plants in Kenya is set to open a new battle front with Japanese, India's and local assemblers.
Their entry is set to loosen the stranglehold of Thika-based Kenya Vehicle Manufacturer (KVM), the Association of Vehicle Assemblers (AVA) Limited of Mombasa and General Motors East Africa (GMEA) who have come under the spotlight for possible involvement in anti-competitive market practices linked to sale of overpriced goods.
Toyota Corporation plans to acquire half of AVA to assemble Hino trucks and buses locally and tap the rising demand for heavy commercial vehicles in the region with India's Tata to unveil such assemblies.
The new assemblers are looking to use Kenya as the launching pad for entry into the regional common market, reaffirming Nairobi's position as East Africa's economic hub.
The fragmented economies of the five East African countries had discouraged the auto dealers from setting up assembly plants, but the common market has made it possible for the dealers to capture a region of more than 130 million residents.
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