The Isuzu Motors South Africa (Isuzu SA) plant, in Port Elizabeth, has started supplying knocked-down (KD) D-MAX bakkie kits for assembly at the Isuzu manufacturing facility in Kenya.
This represents the first intra-continental regional trade exchange of its kind for the Japanese vehicle manufacturer in Africa.
The supply agreement is also in line with Isuzu’s strategy for its South African vehicle assembly plant to serve as a hub for growing its overall volumes in sub-Saharan Africa.
Isuzu Motors, the majority shareholder in Isuzu East Africa, believes there remain significant opportunities in Africa, based on infrastructural investment, notes the company.
Isuzu had a 44.5% share of the Kenyan new vehicle market in 2019.
Isuzu’s East African operation previously focused only on truck and bus assembly operations, while importing fully built-up light commercial vehicles from South Africa.
Isuzu SA CEO Michael Sacke says Isuzu’s market strength in East Africa can be attributed to vehicle performance and reliability, as well as customer satisfaction.
“We have put this project together in record time and anticipate that it will result in a win-win for both South Africa and Kenya.
“Some of the vehicle kits have already arrived in Kenya and the Kenyan team received comprehensive training in Port Elizabeth late last year in preparation for actual operations.”
The vehicle kits, which are exported from the Port of Ngqura, provide additional volume at the port, while ensuring job retention at the South African plant.
While Kenyan bakkie volumes have been projected at 1 300 vehicle kits a year, it is expected that this will further increase in the medium to long term.
“The Kenya KD project is an important step in achieving our growth strategy, which is geared at strengthening our presence in key sub-Saharan Africa markets through a combination of tactical knock-down initiatives, as well as various initiatives to strengthen our dealer distribution network,” notes Sacke.
The KD programme gives the Kenyan operation more flexibility and an opportunity to remain competitive, adds Isuzu East Africa MD Rita Kavashe.
“Our import tariffs are lower on the KD kits, we create employment and we positively influence employee and customer morale by assembling the Isuzu D-MAX locally.”
Isuzu SA has a network of 79 dealers in South Africa and 33 in sub-Saharan Africa.