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Kenya’s chance to build e-mobility industry is now

Africa News News African September 23, 2026 · Comments off

Kenya’s industrialisation conversation is entering a new phase. The country is looking beyond the ambitions of Vision 2030 toward an economy that produces more, attracts investment and competes in regional and global markets.

At the same time, transport is undergoing a major shift as electric mobility takes hold across motorcycles, buses, three-wheelers and passenger vehicles. For Kenya, these two developments come together at an important moment: we have an opportunity to build new industries around the technologies that will shape how Africa moves.

Kenya is already building capacity around electric mobility. More than $400 million has been invested in the sector, covering vehicle assembly, battery technology, charging infrastructure and related services. Electric motorcycles are now assembled with 15 to 30 percent local content, electric buses from Completely Knocked Down kits and passenger vehicle assembly is also taking shape.

Together, these investments are building the skills, supplier networks and production capacity needed to grow the industry. The question now is how far we can take that capacity and how much of the value created by the sector can be retained here.

What happens next will depend greatly on the policy environment around this investment. An investor putting money into a vehicle plant, tooling, component production or charging infrastructure is making a decision that can stretch over many years.

The same is true for a Kenyan company deciding whether to invest in machinery, skills and new production lines. When tax measures change unexpectedly, regulations take too long to conclude or policy statements leave room for different interpretations, those decisions become harder to make.

The reason to build that certainty is also economic. A fully built vehicle may put another electric vehicle on a Kenyan road, but much of its value has already been created elsewhere. Assembly brings engineers, technicians, suppliers, transporters and other businesses into the production process. As more components and services are sourced locally, more of that value stays in the economy.

The government’s commitment to make the first 100,000 electric vehicles imported into Kenya duty-free could give the sector a significant boost and make electric mobility more accessible.

A market of that size also raises a broader industrial question: how much of the demand will translate into production here? Where local assembly is possible, the policy framework should encourage manufacturers to invest and produce in Kenya.

Kenya Association of Manufacturers (KAM) has proposed that the duty-free framework support locally assembled vehicles in categories where the country already has production capacity.

Preliminary KAM analysis also puts the difference into perspective. If 100,000 vehicles were assembled locally, the industry could support about 6,300 jobs in the early years, rising to approximately 12,500 as production deepens, while retaining about Sh12.2 billion in local value each year.

Under a fully built import model, the same 100,000 vehicles would support about 400 jobs and retain around Sh6.9 billion locally.

Localisation also has implications for affordability. A Siemens Stiftung study in Nigeria found that electric motorcycles with more than 25 percent local content cost about 41 percent less per unit than fully imported motorcycles.

For Kenya, building a stronger local supply base could therefore help bring costs down while creating more opportunities for manufacturers and suppliers.

For manufacturers, that support needs to be matched by consistency across the wider policy environment. Automotive investments take years to plan and recover, whether the money goes into factories, equipment, tooling, supplier development or skills. When tax measures change unexpectedly, regulations remain unresolved or policy decisions are unclear, companies have less confidence to commit further capital.

Finalising the amendments under Legal Notice 125 and Legal Notice 147, alongside the existing framework under Legal Notice 84 and Legal Notice 112, would therefore give manufacturers greater clarity.

There are already examples of support that can help move this forward. The Kenya-Japan Samurai Bond has directed financing towards the automotive and spare-parts sectors, supporting investment in manufacturing capacity, skills and technology.

Building on this kind of support, alongside a clear and predictable policy environment, would give manufacturers greater confidence to deepen their investment in Kenya.

The gains would extend beyond the vehicle itself. More local production would create business for steel, plastics, electronics, batteries, software, logistics and technical services, while giving Kenyan firms more room to move into higher-value parts of the supply chain. That wider industrial base can then serve a much larger market.

Through the East African Community (EAC), Common Market for Eastern and Southern Africa (Comesa) and African Continental Free Trade Area (AfCFTA), manufacturers based in Kenya can reach markets across the continent. There is room to build vehicles suited to African roads and conditions and serve those markets from here.

Kenya can also draw from the experience of countries that have built strong automotive industries. India linked incentives to localisation as it developed its automotive sector. Brazil has increasingly tied its green mobility agenda to domestic production, while Indonesia has worked to ensure that import incentives do not weaken local manufacturing.

Their approaches are different, but they point to the same practical lesson: businesses invest, build skills and expand when they have confidence in the direction of policy.

As a country, we have pursued this ambition before. The Nyayo Car captured the imagination of a generation and reflected the belief that Kenya could one day build its own automotive industry.

Today, one of its prototypes sits in a museum, reminding us of an ambition that outpaced its time. Electric mobility presents a stronger foundation. Investment has begun to reshape the sector, local manufacturing capability continues to grow and access to regional markets has expanded. The opportunity before us is to turn that ambition into an industry that has longevity for generations.

The real measure of this transition will not be how many electric vehicles arrive at our ports, but how many leave our factories. With clear and predictable policies, Kenya can turn growing demand into investment, skilled jobs and a green manufacturing industry that serves markets across Africa.

Tobias is the Chief Executive of Kenya Association of Manufacturers and can be reached at [email protected]

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