Kenya opens up for Chinese carmaker as Conglomerate signs deal to take on franchise

The Chinese carmaker Zhejiang Geely Holding Group will introduce two car models in Kenya next month.

Simba Corporation of Kenya signed an agreement with Geely and will be the franchise holder of the Geely brand in East Africa's largest economy.

Ash Sutcliffe, a spokesman for Geely in East China's Zhejiang province, says that after doing extensive surveys in Kenya. the company had decided to introduce two vehicles, the Emigrand 1800cc and the LC Cross 1500cc, in the country this year.

The cars have strong suspension systems and high ground clearance to handle Kenyan roads, Sutcliffe says.

Speaking separately in Nairobi, Geely's brand manager, Jagruti Joshi, says the first consignment of cars was expected to arrive in Mombasa in the third week of October and go on sale about three weeks later.

The two cars are being demonstrated to potential customers at the offices of Simba Colt, Joshi says. This company is a flagship of the conglomerate Simba Corporation Limited, which assembles motor vehicles, distributes spare parts, manufactures hardware supplies, and is in banking, cinemas, film distribution and real estate. It is a sales agent for the Japanese Mitsubishi brand of Fuso trucks and buses, passenger cars and SUVs.

In June the company signed a franchise deal to sell cars of the French company Renault in seven African countries including Kenya. Simba Colt is now partnering with Portuguese giant Grupo Salvador Caetano SA to sell the Renault brand under the Simba Corporation name, after DT Dobie Kenya Limited and its affiliates in other countries lost rights to sell both the Nissan and Renault cars in 2012.

This followed Simba Colt's acquiring the rights to sell Indian Mahindra vehicles from Oriel Kenya, a subsidiary of the Ecta Group of companies. In 2008, Simba Colt also took over the franchise of BMW from Mashariki Motors.

Zhejiang Geely Holding Company, founded by its chairman Li Shufu, is ranked among the top 10 carmakers in China. In 2009, Geely bought the world's second-largest automatic transmission company, Drivetrain Systems International of Australia. It has since set up three factories in China to make the gearboxes.

The new factories are in Xiangtan, Hunan province; Jining, Shandong province; and Tongliang county, Chongqing. DSI's former gearbox factory in Lavington, Australia, is still in operation. DSI automatic gearboxes are fitted on Geely, SsangYong and Mahindra vehicles.

Referring to Geely's purchase of the Swedish Volvo brand from Ford Motor Company of the United States in 2010, Sutcliffe says the acquisition means it can make Volvo vehicles customized for China.

"The Chinese luxury car market prefers large sedans. We are therefore set to launch the Volvo S90L specifically for it."

The Volvo S90L is expected to directly compete with the Audi A6L, BMW 5Li and the Mercedes-Benz E-Class L.

(China Daily Africa Weekly 10/17/2014 page22)