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Electric vehicle manufacturers seek tax cuts

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By Judith Gicobi

Electric car makers are requesting that the Kenyan government implement tax incentives to reduce the cost of owning and running electric cars.

This arises as international automakers begin to expand operations in Kenya in order to get a footing in the region’s market.

“The development of electrical vehicles is accelerating globally and Kenya has some way to go to establish the right conditions for the local industry to flourish,” said Pedro Campos, Managing Director of Caetano Kenya.

The company, which is based in Portugal, has local franchises for Hyundai Renault and just gained the rights to distribute KIA vehicles in Kenya. It intends to start a local assembly.

“The Kenyan government targets to have five per cent of new vehicle sales to be electric units by 2025,” he explains.

BasiGo, a Nairobi-based firm, debuted Kenya’s first electric bus last month, which is aimed at investors in the country’s public transportation sector.

However, manufacturers claim that electric vehicle production prices are still quite high, which has been aggravated by Covid-19 and the global supply logistics turmoil.

“The cost of production for electric cars is still too high and the tax incentives are necessary to lower the retail cost for the consumers,” said Campos. “We need tax incentives on the duties payable both on the components and whole units to make it appealing to consumers.”

He further explains, “There’s also a need to invest more in setting up charging infrastructure.” “Today, we have about 10 charging points in Kenya while in reality thousands will be needed”

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