Kenya Signs Agreement with Toyota to Establish Vehicle Manufacturing Plant
Kenya and Toyota Tsusho Corporation of Japan have signed a framework agreement for cooperation in vehicle manufacturing and renewable energy development. As part of the agreement, Toyota will establish a vehicle manufacturing plant in Kenya, with an initial investment of Ksh 800 million pledged towards the Kenya Thika vehicle manufacturers.
Toyota Tsusho Corporation's decision to establish a car assembly plant in Kenya marks a significant milestone for the country's manufacturing sector. The initial investment of Ksh 800 million in the Thika vehicle manufacturers signifies Toyota's commitment to driving Kenya's automotive industry forward.
President William Ruto hailed the agreement as a positive step towards strengthening Kenya-Japan relations and creating job opportunities for Kenyans.
President Ruto stressed the importance of affordability in locally manufactured vehicles and the need to strike a balance between imported and domestically produced vehicles. The signing ceremony, attended by President Ruto and Toyota Tsusho Corporation President Ichiro Kashitani in Tokyo, demonstrates a shared commitment to sustainable economic growth and technological advancement in Kenya.
The agreement not only encompasses vehicle manufacturing but also emphasizes the development of renewable energy in East Africa's largest economy. This commitment involves substantial investments, including Ksh 15 billion in the Meru Wind Farm Energy project, Ksh 8 billion in the Isiolo Solar Energy project, and Ksh 75 billion in the Menengai Geothermal Plant.
In July 2023, Toyota Tsusho Corporation initiated semi-knockdown (SKD) production of Toyota's Fortuner SUV through a local contractor, Associated Vehicle Assemblers Ltd., at its Mombasa Plant in Kenya. This marks Toyota Tsusho's first SKD production of an SUV in Kenya, with an annual production target of 350 units. The move aims to meet the growing demand for SUVs in Kenya and reduce lead time for vehicle supply.
Investor
Outbound region
Inbound region
Industry
Date of record
7 February 2024
