perminusotieno wrote:I agree 100% with Harrydre. We have destroyed the value chain that comes from an established market for brand new cars. Think of all the jobs that would be created and skills that would be passed to our economy if we were assembling Toyotas and other makes in large numbers. The benefits to our emerging economy would be enormous. In my opinion, our reliance on mitumba goods from cars and clothes to spare parts has done so much to destroy industry in this country.
Does anyone seriously believe that the widespread importation of Japanese rejects adds any value to our economy? I challenge anyone to prove how these mitumbas have benefited Kenya's economy.
All boils down to economics.
In the US, a brand new Rav 4 goes for about $22000 (about 2m KES). The same costs 4.8m according to KRA CSRP.
The choice becomes - buy the brand new one at 4.8m, or get a mtumba one for 1.5m. The running cost of the Mtumba one in 5 years will not exceed the 3.3m difference. Economically - makes sense to buy the mtumba one, after all, it still works.
If Toyota had a factory in Athi River and was able to sell the Rav4 locally at 2.5m, that would be attractive. But they dont, so we dont have any option as an economy but to depend on what we can afford.
That said, we should be encouraging the likes of toyota to setup factories. In S.A, every major manufacturer has a factory, showroom. Factors: cheap power, high buying power, an economy that works. We should be creating the environment for such.