You are here  » Home   » Business News

Number plates shortage hits car importers hard

By Patrick Alushula | Published Tue, July 18th 2017 at 00:00, Updated July 17th 2017 at 20:23 GMT +3


Kenya Motor Repairs Association Chairman Bernard Ngore (centre) presents Transport ministry's Administration Secretary Naftali Mung’athia with a report on motor vehicles inspection in Kenya at the Nairobi’s Panafric Hotel yesterday. With them is Head of Road Transport Services Unit at the Transport ministry Martin Eshiwani. [Elvis Ogina, Standard]

The shortage of motor vehicle number plates is costing car importers about Sh26 million daily in storage costs as they await the processing of new ones at the Kamiti Maximum Security Prison.

According to Federation of East African Freight Forwarders Association President Auni Bhaiji, the Mombasa Port and other private storage points are holding more than 2,000 vehicles despite owners having paid taxes to Kenya Revenue Authority (KRA).

“It is really bad now. Last week, we had more than 2,000 vehicles waiting for allocation of number plates. There is no point of importing then you are slapped with huge storage costs just because of non-availability of plates,” said Mr Bhaiji.

The number could go higher, especially now that dealers estimate that monthly motor vehicle imports stand at 6,000 vehicles monthly. It is mandatory for imported second-hand vehicles to be fitted with number plates before being allowed on local roads.

The problem started at the tail end of last year, eased a bit by the end of February, but it has now become worse, with importers having to wait for between four and six weeks before being allocated number plates for newly imported vehicles. Storage costs increase based on time, with importers also incurring opportunity costs such as the foregone businesses in case their vehicles are for commercial purposes.

Avoid fake news! Subscribe to the Standard SMS service and receive factual, verified breaking news as it happens. Text the word 'NEWS' to 22840

Speaking yesterday at a Nairobi hotel, Mr Bharji said the Kamiti Maximum Security Prison, which is charged with churning out new licence plates, was struggling to cope with the high demand for the same as they have to process for both motor vehicles and motor cycles.

The challenge in meeting demand for new licence plates comes at a time when motor vehicle imports are on the rise, with latest industry figures showing that vehicles getting into the country almost doubled in the three months to March this year compared to a similar period in 2016.

The overall growth in the sector was mostly driven by a rise in the number of motorcycle imports, which rose three-fold.

Limited capacity

The number of new motor vehicles registered by KRA in the first quarter of this year increased by 91 per cent to 72,000 compared to the 37,000 registered in 2016.

According to Kenya National Bureau of Statistics (KNBS), the number of motorcycles that got into the market grew sharply to 51,000 during the first quarter of 2017, a 183 per cent growth in comparison to the 18,000 that were bought by Kenyans over a similar period last year.

Head of Road Transport Services Unit at Ministry of Transport and Infrastructure Martin Eshiwani yesterday said there had been some “slight delays” at from Kenya Prisons, leading to the shortage in new plates.

“Kamiti Prison told us that this delay is because of limited capacity and weather. They do everything manually, including painting and since the sun is in short supply now, it takes more time to dry,” he explained.

Mr Bhaiji, who is also the chairman of Kenya International Freight and Warehousing Association, meanwhile, urged National Transport and Safety Authority (NTSA) to take temporary measures such as issuing temporary plates.

“It could also make the aluminium number plates as we have already proposed,” he said. NTSA had planned to roll out new generation number plates, but the process ran into headwinds over a dispute in the tendering process, handing the role back to the prisoners.