Deluxe Trucks and Buses East Africa has reported a 50% increase in sales since the start of the year, selling 92 trucks in the first half of 2024.
The positive performance comes despite a challenging economic climate in Kenya, with the Kenyan truck and bus market contracting by 17-18% compared to the same period last year.
The distributor (for Ashok Leyland Trucks and Buses) has set an ambitious target of securing the number two position in overall sales by the end of the year, focusing on the tipper segment for strategic growth.
The Kenyan truck and bus market, valued at approximately USD 2 billion, has historically been fueled by infrastructure development, urbanization, and the burgeoning e-commerce sector.
However, the current year has seen a contraction of 17-18% compared to the same period last year, attributed to economic pressures, new taxes, political protests, currency fluctuations, and rising fuel costs.
Hussein Kamal, the newly appointed General Manager of Deluxe Trucks and Buses East Africa, acknowledges these challenges, stating that “the broader economy is facing difficulties, with businesses struggling with affordability, access to capital, and high operational costs.”
Despite this, Deluxe Trucks and Buses remain optimistic, having sold 92 trucks in the first half of 2024, a significant figure considering the industry-wide slowdown.
The company has set an ambitious target of securing the number two position in overall sales by the end of the year, focusing on the tipper segment for strategic growth.
“This growth indicates the market’s potential for value-oriented products in the light and intermediate commercial vehicle segments,” says Kamal.
While our numbers may be modest compared to the competition, we believe we have immense opportunities for growth over the next year.
Kamal, an industry veteran with over 20 years of experience, attributes this positive outlook to Ashok Leyland’s competitive pricing, high-quality vehicles, and comprehensive after-sales support. The brand, positioned as a challenger, offers a unique 5-year or 500,000-kilometer warranty, making it a compelling option in the current economic environment.
The Ashok Leyland Phoenix light truck, for instance, allows customers to calculate the cost of transporting goods for up to four years, demonstrating long-term value and return on investment.
This strong value proposition has enabled Deluxe Trucks and Buses to target a 20% market share in the fast-moving consumer goods segment, which accounts for over 50% of all truck sales in Kenya, by the end of 2025.
While acknowledging the short-term economic challenges, Kamal remains cautiously optimistic about the future, predicting a period of consolidation followed by renewed growth as the economic situation stabilizes.
He emphasizes the company’s success measurement based on “cost of operations,” a metric tailored for specific market segments.
Addressing the issue of high operating costs, which often represents a significant barrier for commercial vehicle owners, Deluxe Trucks and Buses has established strategic partnerships with major commercial banks, offering customers access to up to 95% financing or refinancing.
