Car importers seek extension for 2013 units on vessels scarcity

Use car importers now want the government to extend the December 31 deadline for clearing of vehicles manufactured in 2013.

This is on the vessel scarcity in the global market, mainly for conventional and container cargo witnessed for the better part of the third quarter, an element that has affected imports.

Importers said lack of ships has led to delays in bringing in the units, with some 2013 made cars expected to arrive later next year.

A per Kenya's eight year first date of registration rule as the maximum age for imported used cars, December 31 is the last day for 2013 manufactured vehicles to be cleared into the country. 

Through the Car Importers Association of Kenya (CIAK), the traders have appealed to the Kenya Bureau of Standards and the Industrialisation, Trade and Enterprise Development ministry, to allow them an extension of three months, to March 2021.

“We are asking the government to allow us until March, if not, at least give us until end of February to clear these units. We are afraid a huge number of units will be locked out if the government will not consider this,” CIAK national chairman Peter Otieno told the Star.

With an annual spending of an estimated Sh60 billion on imported used cars by Kenyans, CIAK says both car dealers and individual importers are staring at huge losses.

“The industry needs an exemption or else people are going to loose their money,” Otieno said.

Industrialisation, Trade and Enterprise Development CS Betty Maina yesterday however remained firm on import regulations.

“All importers were advised to ensure vehicles get in before December 2020. They were advised in September to ensure goods arrived by December,” CS Betty told the Star in a message.

The car importers have 36 days from today to have brought in and cleared 2013 manufactured vehicles.

This means late orders are likely to be locked out noting that it takes between 26 to 30 days to sail from Japan to Kenya while vessels moving between Europe and Mombasa take between 20 and 40 days, depending on the departure and destination ports, with most vessels calling at a number of ports before docking at Mombasa.

Yesterday, Kenya International Freight Forwarders Warehousing Association (KIFWA), the clearing agents umbrella body, noted a surge in the cost of imports for their clients in the last two months, blamed on vessels scarcity.

“There has been a concern on freight charges which have gone up. This has also affected car prices in the market,” Kifwa national chairman Roy Mwanthi said on telephone.

Kenya imports 80 per cent of its cars from Japan. Other markets are United Kingdom, United Arab Emirates,Singapore and South Africa.

There are at least six conventional vessels with vehicles in the high seas en route to Mombasa, expected to dock at the port between Saturday(November 28) and December 7, Kenya Ports Authority schedule shows.

The number of imports in the last quarter of the year have traditionally risen based on last minute orders, where prices of these vehicles are lower compared to January, as sellers move to secure the Kenyan market before the eight-year rule deadline.

According to industry trends, imports between January and March average 3,000 to 4,000 before picking up to 9,000 in the second half of the year.

The numbers can go up to 15, 000 units. For instance last year, monthly imports hit a high of 20,000 in December.

The last time the eight-year rule caught up with importers was in 2014 when more than 2,000 used motor vehicles registered in 2006 were locked out of the country, leading losses of millions of shillings by dealers and individual importers.

Second-hand cars dominate the local market accounting for 85 per cent of Kenya's car purchases, with an annual import of above 86,000 units.

The government has been seeking to reduce the age limit to five years to promote local assembling and address emission concerns blamed on combustion in old cars.