A series of strategic investments by Chinese automotive manufacturers is poised to significantly expand Kenya's local vehicle assembly industry, signaling a new phase of industrial partnership between the two nations. In announcements made on Monday, November 10, 2025, major players including Chery and its sub-brand Jetour have committed to establishing Completely Knocked Down (CKD) assembly lines in Kenya by 2026. [4, 13, 14]

This influx of investment directly aligns with the Kenyan government's National Automotive Policy, which aims to bolster local manufacturing and reduce the country's heavy reliance on imported used vehicles. [3, 25, 29] The policy offers significant fiscal incentives, including exemption from a 35 percent import duty and excise duties ranging from 20 to 35 percent, for vehicles assembled locally from CKD kits. [13, 33]

New Plants, New Jobs

Chery, through its local partner Caetano Kenya, confirmed that local assembly of its popular SUV models will commence in 2026. Aurélien Glay, Managing Director of Caetano Kenya, stated on Monday that the initiative is designed to "create jobs, enable transfer of skills, accelerate industrial growth, and generate greater local value." [4, 14] The company aims to sell between 200 and 400 units in its first year of operation. [4, 14]

Separately, Global Motors Centre (GMC), the appointed distributor for Chery's Jetour brand, announced a Sh1.4 billion investment to begin assembling Jetour models at its Mombasa plant from the first quarter of 2026. [13] Ali Zubedi, the Managing Director of GMC, confirmed the investment and noted that local assembly will allow for more competitive pricing. [13] The entry of Jetour was welcomed by Erastus Gatebe, the Industrialization Secretary at the Ministry of Investment, Trade and Industry, who on Friday, November 7, 2025, described it as a symbol of deepening cooperation between Kenya and China in the automotive sector. [19]

The focus extends to electric mobility, with Chery also committing $20 million (approx. Sh2.6 billion) in partnership with Afrigreen Automobile to build an EV assembly plant in Nairobi. [20, 23] Abubakar Hassan Abubakar, Principal Secretary of the Ministry of Investments, Trade, and Industry, noted this project is expected to create 3,000 direct and indirect jobs and will contribute to greening the transport sector. [20, 23] Other Chinese EV manufacturers, such as NETA Auto, have also announced plans for local assembly in partnership with Kenyan firms like Moja EV. [7, 9, 21]

Shifting Market Dynamics

Kenya's automotive market has long been dominated by imported second-hand vehicles, primarily from Japan, which account for the vast majority of cars on the road. [3, 4] The government's policy push, including the 'Buy Kenya, Build Kenya' initiative which encourages state agencies to procure locally assembled vehicles, is designed to reverse this trend. [8, 15] The ultimate goal is to leverage Kenya's installed annual assembly capacity of 46,000 units and position the country as a key automotive hub for the wider East Africa region. [6]

The move towards local production is gaining momentum across the sector. After a 14.58 percent drop in local assembly output in 2024 due to challenging economic conditions and high borrowing costs, the industry has shown a strong recovery. [33] In the first half of 2025, Kenya's vehicle assembly industry witnessed a 16.4% year-on-year increase, producing 6,723 units. [5, 6] This resurgence is largely attributed to government incentives that have successfully attracted foreign investment. [5, 6]

By assembling vehicles locally, companies can significantly lower the final cost for consumers compared to fully built imported units. [4] This, combined with extended warranties and the introduction of modern, affordable models, is set to intensify competition in the new vehicle segment. [4, 12] The investments from Chinese automakers represent one of the most significant developments in Kenya's manufacturing sector, with the potential to create a robust local value chain, enhance technological capacity, and provide Kenyan consumers with greater choice and affordability. [12, 19]