German automative global giant, Volkswagen, will begin making new cars in Kenya's industrial town of Thika north east of Nairobi.
Thomas Schaefer, Chairman of the German carmaker's South Africa division, told a news conference in Johannesburg last week DT Dobie, VW's importer and general distributor in Kenya, owned a 30% shareholding in Kenya Vehicle Manufacturers, a multiband assembly facility that would assemble the Vivo on a contract basis.
Schaefer said full production of the Polo Vivo will begin in January next year. However there will be a ceremonial roll-off of the first car on December 21. Initial production will involve 1,000 cars a year.
In September, President Uhuru Kenyatta witnessed an agreement between the Kenyan government and Volkswagen South Africa (VWSA), who will oversee the Thika venture.
On that occasion Schaefer who is also VWSA managing director, said "We are taking the successful Polo Vivo from South Africa to Kenya to leverage the enormous growth potential of the African automobile market and participate in its positive development.
This compact model is the best-selling car in the Sub-Saharan region – so it is the ideal entry model for the promising Kenyan market."
In 2010, VWSA announced that the Volkswagen Citi Golf is being replaced by a version of the Mk 4 Polo, and renamed the Polo Vivo. It is manufactured at VW's Uitenhage plant in South Africa, which sources 70% of the Vivo parts locally.
"This is not the first time for VW to have a manufacturing presence in Kenya."
During the 1960s, it used to assemble the Beetle in Kenya. The vehicle kits for the Thika project will be imported from Uitenhage.
Schaefer said at the signing of the deal "With this move, we are strengthening the brand's overall position in Africa and taking an important step towards expanding our commitment in the region."
Referring to affordability Schaefer said last week there is a strong and growing middle class in Kenya that can afford to buy a new car.
Recently the African Association of Automotive Manufacturers (AAAM) was unveiled to push governments on limiting imports of second hand vehicles.
It includes such top names Volkswagen, Toyota, General Motors and BMW and AAAM also wants some tax concessions and incentives to encourage vehicle manufacturers.
"Kenya has a plan to push it year by year to younger vehicles and with that you automatically increase the new car market," Schaefer said during the news conference.
When vehicle finance is available, buyers will be able to pay for their new Vivo in instalments.
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