Kenya bets on EVs to cut fuel imports and create jobs as local assembly surges 16%

Kenya is betting big on electric vehicles as it seeks to cut fuel imports, create jobs, and boost clean energy use, but success will hinge on linking vehicle assembly with its renewable power surplus, industry leaders and officials say.

For decades, second-hand imports have dominated Kenya’s car market, accounting for more than 80% of sales. But electric vehicles (EVs) are now being framed as the disruptor that could turn this reliance into an opportunity. “Localization is not just about assembling cars. It’s about making chargers, battery packs, and key EV components that create lasting jobs,” said Tobias Alando, Chief Operating Officer at the Kenya Association of Manufacturers.

Every EV on Kenyan roads runs on locally generated electricity, 90% of which comes from renewable sources like geothermal, wind, and hydropower. “That makes energy itself local content,” said Moses Gachemi Nderitu, Managing Director of BasiGo, which assembles electric buses in Nairobi. “Each vehicle reduces fuel imports while anchoring new jobs in both manufacturing and energy.”

Kenya currently curtails between 300–400 GWh of electricity yearly, due to low off-peak demand. Analysts say EV adoption could absorb this surplus and spur new generation projects. A medium scenario shows that within 5–7 years, 50,000 EV cars, 500,000 electric motorcycles, and 5,000 buses could consume about 1.19 TWh annually, nearly three times today’s wasted energy. That would require 120–150 MW of new renewable capacity, seen by officials not as a burden, but as an investment trigger.

The government is aligning policy to support the shift. New incentives exempt tariffs on imported EV parts, while older polluting imports face higher taxes. Financing models are also evolving, with Pay-As-You-Drive options lowering the barrier for drivers. “This facility will strengthen our local vehicle assembly and parts manufacturing industry while also addressing electricity losses,” said Foreign Minister Musalia Mudavadi, after signing a $169 million Samurai loan agreement with Japan in August.

Kenya’s assembly output is already rebounding. In the first half of 2025, 6,723 vehicles rolled out of local plants, up 16.4% from 5,778 a year earlier, recovering from declines in 2022 and 2023. German and Japanese automakers have restarted local projects, including Volkswagen SUVs and Toyota Fortuners, while promising to create hundreds of jobs.

Industry analysts argue that success depends on Kenya broadening the definition of “local content” beyond vehicles. “Every imported fuel tanker is exported jobs. Every EV, whether imported or assembled here, locks value into our economy because it runs on local clean power,” Nderitu said.

The twin play of EV localisation and renewable energy could give Kenya a first-mover advantage in Africa’s $50 billion automotive market, which the African Development Bank estimates will more than double by 2035. For many Kenyans, the payoff is more immediate: cleaner air, quieter streets, and cheaper rides.

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