Demand for heavy commercial vehicles in Kenya
Mumo, Jackson M
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Despite measures taken by the government to address the ever increasing demand for heavy commercial vehicles, the demand for the same remains high. Due to the high costs involved in the purchase of heavy commercial vehicles, there has been a paradigm shift from importation of fully assembled units, to local assembly and most recently to leasing which is considered by many to attract less cost. Using data collected from various sources like, Kenya Revenue Authority, Kenya National Bureau of Statistics and World Bank, a time series estimation technique has been used to explain the demand for heavy commercial vehicles in Kenya. This study established that fuel prices, investment in infrastructural facilities like roads and. the railway system and, the stock of heavy commercial vehicles in the country play a big role in shaping the demand for heavy commercial vehicles. The government has a role to play in investing in infrastructural facilities while at the same time checking the wide fluctuations in fuel prices which adversely affect the heavy commercial industry and may lead to external shocks in the entire domestic economy. The stock of heavy commercial vehicles and its sustainability plays a critical role in determining the rate of additions of new stock and thus the demand for heavy commercial vehicles at any particular time. Efforts should also be made to improve trade facilitation within the region especially by Kenya's landlocked neighbors whereby Kenya is the major transit route most of which is via road by heavy commercial vehicles.