Offering access to the lucrative used car markets in the countries that surround it and also its own, Kenya has become a popular destination for used and salvage U.S. vehicles. Demand for second-hand cars in Kenya has increased sharply in the past decade, with used-car sales making up nearly 80% of all vehicle sales in the country overall. Needless to say, for the would-be exporter/importer of used and salvage U.S. vehicles, Kenya presents an attractive import destination.
Despite the growth of its used car market, though, one should note that there are some pros and cons to importing U.S. used vehicles into Kenya. On the plus side, clearing customs is incredibly simple, and the United States enjoys easy import procedures thanks to the Trade and Investment Framework Agreement (TIFA). On the con side, import duties and taxes are much higher in Kenya than they are in other neighboring countries.
Kenya’s burgeoning used car market is hard to ignore. Here’s everything you need to know about importing used and salvage vehicles from the United States into Kenya.
Purchasing Used or Salvage Cars at U.S. Auctions
When purchasing a used or salvage car in the United States, there are several different options. However, when it comes to cheapness and convenience, there’s simply no substitute for online used car auctions. From the comfort of your own home or office, you can use an online used car auction site to gain access to an inventory of vehicles upon which you stand to save up to 70 or even 80 percent!
Online car auctions are incredibly easy to participate in, too! It’s just as easy as setting using a service like eBay. Create an account with an online car auction site and then make an initial deposit. This initial deposit is necessary to establish your bidding power. In most cases, it will be worth roughly one-tenth of your total maximum bid. So, if you want to be able to bid up to $5,000 on used and salvage U.S. vehicles, you’d want to make an initial deposit of $500.
You’ll be able to browse the inventory of vehicles and auctions displayed publically on the online car auction site. You’ll also be have access to an auction broker or agent who can assist you throughout the entire process. He or she can work with you on bidding strategy and can even help to find vehicles and auctions that will meet your specific needs.
Understand, though, that online car auction sites cannot publically display all of the inventory and auctions to which they have access. However, your auction agent or broker can share non-publically-displayed auctions with you, thereby expanding your options. If you’re looking for specific makes and models, this is something you should take advantage of!
Shipping a Used or Salvage U.S. Vehicle to Kenya
As a major trading partner of the United States, finding a port that offers shipping service to Kenya should be quite easy. However, you will have to determine whether you’ll want to use conventional container shipping or something known as RORO shipping, which stands for “roll-on roll-off”.
If you’re shipping low-cost vehicles, you may wish to give RORO shipping strong consideration. It is much cheaper than traditional container shipping and much more convenient. At the departure port, your vehicle will roll onto the ship and secured. Once arriving in Kenya, the used vehicle will detach and roll off of the ship and into the port of your choice.
The only drawback of RORO shipping is that it’s a bit riskier than traditional container shipping. Because your vehicle will not be completely enclosed in a container, it could become exposed to the elements. Further, the vehicle may need to be moved during shipping, which does present the opportunity for damage to occur.
Once you’ve selected your preferred method of shipping and a departure port, you will then need to select an arrival port in Kenya. The Port of Mombasa serves as the primary container port in Kenya and is where most ships will offer shipping services. However, there are other options, namely the Port of Dar-Es-Salaam. However, destinations other than the Port of Mombasa will only be available for the aforementioned RORO shipping method.
To learn more about these ports, you can consult the Kenya Ports Authority (KPA) website here. You may also wish to consult with the Kenya Maritime Authority (KMA), too. You can find their website here.
Before arranging to ship your used or salvage U.S. vehicle to Kenya, there’s an important thing that you’ll need to know. You’ll need to arrange the services of a licensed clearing agent at your port of arrival in Kenya. This is a requirement and not a suggestion. For your convenience, Kenyan customs provides a list of licensed clearing agents with whom you can work right here.
Getting Your Used or Salvage Car Through U.S. Customs
Moving a used or salvage vehicle through U.S. Customs is a very easy process. After selecting your departure port, you will need to arrange to have the vehicle at the departure port at least 72 hours before shipping. In addition, you’ll also need to provide U.S. Customs agents with an Original Certificate of Title and two complete copies of that title or a certified copy of the title.
Once customs agents have the vehicles and documents, they’ll conduct their pre-shipment inspection. They’ll verify that there’s no illegal contraband stowed away in the vehicle, and they’ll also verify that the documents provided match the car. (They’ll do this by cross-referencing the Vehicle Identification Number (VIN) on the title with the VINs displayed on the vehicle.)
Provided everything checks out, the vehicle will then clear by customs and then loaded onto the ship. Should you have any further questions about clearing U.S. Customs, please consult their website.
Getting Your Used or Salvage Car Through Kenyan Customs
As mentioned, you will need to have arranged for a licensed clearing agent to handle the vehicle clearing process in Kenya. Again, you can find a list of licensed agents recommended by the government of Kenya here.
When handling import duties, taxes, and documents, provide everything to a clearing agent. This agent will then in turn use Kenya’s Simba 2005 system to process all the necessary documentation and payments.
When dealing with the licensed customs agent, you will need to provide the following documentation:
- The Original Bill of Landing
- The Original Commercial Invoice
- An Import Declaration Form
- An Authentic and Original Logbook from the Vehicle’s Country of Origin (See Below)
- Certificate of Title
- Port Release Order
- Evidence of Vehicle Insurance
- Certification of Inspection for the Vehicle
- Proof of Roadworthiness Inspection (Pre-Shipment)
- Your Passport
- A Pin Card from the Kenya Revenue Authority (See Here)
The logbook provided to Kenyan customs must be in English. If it is not, then a translation of the logbook that’s been created by the United States Embassy in Kenya must be provided. (This shouldn’t be an issue mind, but it is something to be aware of.)
In addition to the above, the imported used or salvage vehicle must pass a roadworthiness inspection. This should be completed before the vehicle is shipped to Kenya. Consult a local vehicle inspection service for more details.
In addition to being deemed roadworthy, all U.S. used vehicles imported into Kenya must meet the following requirements:
- The vehicle must be no more than 8 years old. Age is determined by the year of manufacture and not by the date of the first sale.
- The vehicle must be a right-hand drive. No left-hand drive vehicles are allowed unless granted an exemption.
Import Duties and Sales Tax for U.S. Vehicles Imported into Benin
Compared to other neighboring countries, the import duties and taxes in Kenya are relatively high. However, paying the premium for importing into Kenya is almost always worth it, given that Kenya provides direct access to the lucrative used car markets in its neighboring countries.
Kenya has its import duty currently established at 25% of the CIF (Cost, Insurance, Freight) value of the vehicle being imported. The cost portion of the CIF is determined by the invoice value of the vehicle. In addition to the above, excise duty is also charged. This excise duty is 20% of the customs value and the import duty (outlined above) combined.
In addition to the import and excise duties, there is also a Value Added Tax (VAT) assessed. This tax will be 16% of the sum of the import duty, the excise duty, and the customs value.
Finally, there is also an Import Declaration Fee assessed. This fee is equivalent to 2.25% of the CIF value of the vehicle or Ksh. 5,000, whichever one is higher.
Kenya does provide an exemption to the payment of the above duties and taxes. This exemption is provided to individuals returning to Kenya who has been living abroad and to those relocating to Kenya. To avail yourself of this exemption, though, you must meet the following requirements.
- The individual must be 18 years or older.
- The individual must have been residing outside of Kenya for at least two years.
- During the two years before returning to or moving to Kenya, the individual must not have been in Kenya for an aggregate of 90 days or longer.
- The vehicle must have been used by this individual for more than 365 days (not including shipping time) outside of Kenya.
- Vehicle must be purchased at least 365 days before importation and not include shipping time.
- The vehicle must have a seating capacity that is less than 13 people. (E.g. it cannot be a bus or minibus.)
- The vehicle must conform to all the other standards for a used vehicle imported into Kenya.
- Only one vehicle is eligible for the exemption.
Needless to say, if this is something you can take advantage of, then you definitely should, given how high Kenya’s import duties and taxes are. To learn more about the duties and taxes exemption, please consult this document. You can also find answers to frequently asked questions about Kenyan import duties and taxes here.
The Used Car Market in Kenya
Ever since Kenya opened the door to used car imports and expanded the age restriction to eight years, the used car market has absolutely exploded in the country. This has been bolstered by income growth among Kenyan workers. Who use online searching tools to search for vehicles that meet their needs. All of this has resulted in a used car market that’s significantly outpacing the new car market in the country.
Currently, Japan and the United Arab Emirates dominate the import market. However, used cars imported from the United States have been steadily growing in their market share. This is due to the fact that many of the used vehicles popular in the Kenyan used car market, particularly pickup trucks, are readily available in the United States.
Kenyan’s Most Popular Imported Used Cars
Japanese makes and models are without a doubt the most popular vehicles in Kenya. Prized for their fuel efficiency, ease of repair and durability, roughly 80% of all used vehicles sold in Kenya are Japanese.
While Japanese cars are prohibitively popular, there is an increasing demand for American brands. In particular, pick up trucks have become exceptionally popular due in no small part to the rapid growth and development of the Kenyan agricultural industry. When importing vehicles remember that General Motors currently manufactures in Kenya. Its presence provides some headwinds to second-hand imported General Motors automobiles.
Broadly speaking, when selecting cars to import into Kenya, one should prize those vehicles that can have rough terrain. Infrastructure is still shaky at best in the country. So vehicles that are capable of traversing difficult stretches of road and country are Kenyan consumers’ preference. In addition, vehicles that are easy to repair and for which replacement parts can easily be obtained are preferable (thus the popularity of Japanese makes).
See our Vehicle Auctions, Car Auctions and Education Centre.
Comments