Motor Show

The 2005 Total Motor show is being held from September 1 to 4th at the Kenyatta International Conference Centre (KICC). It is one of the few enjoyable corporate events that are open to the public. Others include the Air Show (Wilson Airport), Safari Sevens, and Concurs motor show.

This year the entrance fee is up to 300/= shillings ($4) for adults, which is rather pricey, and 50 shillings for unaccompanied children. But the price cushioned by the fact they you get a free autonews magazine (which retails for 150 shillings) and are also entered into a raffle draw with a million shillings cash prize. I had gone there over lunch with 300 shillings in my pocket, hoping to have lunch somewhere, but the event took all my cash.

Who’s there
Represented were auto manufactures including Audi, Chevrolet, Hyundai, Isuzu, Kia, Mazda, Mercedes, Mitsubishi, Nissan, Peugeot, Porsche, Skoda, Subaru, Toyota, Volkswagen, Volvo all with cars, trucks, buses alongside suppliers of spares and accessories.

Fellow bankers
There were many banks represented including Barclays, Diamond Trust, CFC, Southern Credit, NIC and Imperial, all offering a variety of auto loans, hire purchase, insurance finance and credit card products.

Sales teams were in front of each stand handing out brochure and enticing in everyone to leave their phone number and contacts. Whether this energy and enthusiasm will fizzle out over the four day show, we’ll see. One problem with going on the first day is that some stands are not yet staffed, or have no brochures to hand out.

Who’s missing
Dubai vehicle importers: Major motor industry players (especially General Motors & Toyota) always lament each year about duty-free, unroadworthy, 8 year old, 3rd hand “Dubai cars” that are imported from Asia, via Dubai and represent over 70% of the vehicles sold in Kenya every year.

New cars are quiet pricey, which is why a lot of Kenyans are importing or buying “Dubai” cars, and not from local showrooms. E.g. a Chevrolet Aveo was selling at 1.4m ($19,000) while a Nissan Sunny from DT Dobie was going for 1.7 – 1.9 million. But there are people who can write checks and buy cars at the show as someone did last year with the then new Range Rover.

Tax factor
Most of the manufacturer’s two prices for each car; the sale price, as well as the “duty free” price to entice diplomats, donors, churches and other tax-exempt buyers. E.g. While an embassy can buy a BMW 530i for 5.5. million shillings ($73,000), a Kenyan will pay 8.9 million shillings ($119,000) for the same car – 60% more. This disparity is found in all vehicle categories.

The Kenya Revenue Authority was represented at a huge stand and with officers who provided a wealth of information about vehicle importation licensing and tax issues. But they couldn’t tell me why, if I saved enough to buy a car – using my sweat and skills, why I would have to fork over another 60% to them. They were there to collect taxes, not to ask why they collect taxes!

Car Prices
Here’s a sampling of some common 4X4 prices for locals:
BMW X5 9.3 million ($124,000)
Mitsubishi Pajero 4.6 m + VAT ($71,000)
Nissan Patrol 4.6 m to 5.1m ($68,000)
Toyota Prado 4.8 million ($64,000)
Toyota Land Cruiser VX 8.3m ($111,000)
Volvo had the XC90 priced in South African Rand, which was too confusing

Others:
29 seat matatu 2.8m (inclusive of registration & licence)
46 seat luxury bus (9.9 million inclusive of 1 year warranty)
62 seat bus 7.6 million

Lorries:
Mercedes 2628 9.1 million
Mercedes 3340$100k

Star of the Show
Still, there were many of us ogling cars we could not afford; some cars were open for visitors to sit in including a Mercedes CLS350. There were a bunch of people waiting to sit in the front, so I sat in the back, which was rather cramped and listened as a prospective customer told the salesman that he didn’t like the car, because it “resembled a CLK.” The car was locked up soon after and I hope it will be opened up over the weekend. Many of the high-end vehicles from Audi, BMW, Porsche and Land Rover were all locked up

Tivo, Catholics and Mayor Dick

Catholic Church Insurance
According to the East African, the Nairobi Catholic Church has been licensed to start an insurance company, which it hopes will save it from paying out $20 million in premiums each year. This struck me as odd because I just learnt that, in Pakistan, drivers carry no car insurance, because one can’t insure “against the will of God” – which is what accidents are.

“TIVO” comes to Kenya
Also in the East African, Multichoice (K) expects to release personal video recorders on the Kenyan market by June 2006, which will allow viewers to record programs while watching others from their DSTV satellite dish packages.

Nairobian’s Revolt
Long before the constitution became a national debate issue, a group of Nairobians had taken on the Nairobi City Council charging that, since the City did not provide services, accountability, transparency, security, or enforcement of zoning laws residents should not pay any rates or taxes to the City and went to court with their fight. They are collectively known as “We Care About Nairobi DO IT!” and can be reached at P O box 66116 Nairobi Tel: 4447737,4448072 Email:wecandoit@wananchi.com Website: www.wecandoit.co.ke Office: Viking house near Pavement Restaurant & Westlands Roundabout. To show instant support of We Can Do It, court action against City Hall. SMS to 2929 on either Celtel or Safaricom plus your name. (SMSs are charged at 5/- above normal rate. A % of the cost goes toward the legal fund.) They are also open to associate membership at a cost; for individual, at an annual fee of Kshs 2. 000 and to institutions for an annual fee of Kshs 50,000

The 46 million shilling question

Is 46 million shillings a year ($600,000) enough to live on? A successful NY investment hedge fund manager says he’s barely making ends meet with that kind of income.

End of August Updates

Indian Bank to acquire Giro?
The State Bank of India (SBI), is poised to acquire Giro Bank, a mid-size Kenyan Bank. The deal has already received approval from the Reserve Bank of India and is expected to be completed by October 2005. SBI, which has a balance sheet size of $145 billion, has a market share of over 25 per cent in the Indian banking system, while Giro is about the 23rd largest bank in Kenya, with assets of 4.5 billion shilling ($60 million).

Update on stockbrokers
It appears some of the stockbrokers I wrote about earlier may be inactive, have not renewed their licences or the information provided by the NSE may be outdated. Here now is an updated list of stockbrokers from the Capital Markets Authority as at April 2005.

Stockbrokers: Address, Telephone
Sterling Securities Limited P.O. Box 45080–00100, Nairobi
Ashbhu Securities Limited P.O. Box 41684–00100, Nairobi 020210178
Crossfied Securities Limited P.O. Box 34137–00100,Nairobi 020246036
Discount Securities Limited P.O. Box 42489–00100, Nairobi 020219552
Faida Securities Limited P.O. Box 45236–00100, Nairobi 020243811
Francis Thuo and Partners Ltd P.O. Box 46524–00100, Nairobi 020228498
Ngenye Kariuki and Company Ltd P.O. Box 12185–00400, Nairobi 020220052
Nyaga Stockbrokers Ltd P.O. Box 41869–00100, Nairobi 020332783
Reliable Securities Ltd P.O. Box 50338–00200, Nairobi 020241350
Solid Investment Securities Ltd P.O. Box 43046–00200, Nairobi 020244272

Bank Profits
As at June 30 2005, all commercial banks in Kenya were profitable except;

Oriental (formerly Delphis) 36 million loss
Bank of Africa 10m
Paramount Universal 2m

A Nightmare


Yesterday I finished reading Michael Crichton’s “Jurassic Park” and immediately started reading its sequel “Lost World” which I found in the house. I didn’t get very far into it, before I went to bed. Naturally, I wondered what it would be like, and how much better than the movie it would be like. I went to sleep, and had this dream:

I was part of a group of dinosaur hunters, somewhere in the Sahara desert tracking down missing dinosaurs from the Park. We had found a fort in an oasis with a few trees, and had set up a camp and a trap there to catch the last surviving, reptile, a t-rex. The trap was actually a cow which was tied and grazing near some trees in which we hunters were hiding with a whole lot of guns.

At some point during the night, I felt I had to answer a long call of nature and I went to the pit latrine, which was next to cow. As I was doing my business I heard the cow scream, and looked up to see it dangling from the jaws of the t-rex which had appeared out of nowhere. I finished up, and ran into the trees yelling to my fellow hunters to start shooting, which they did. They came out of the trees guns blazing firing at the dinosaur.

T-Rex seemed confused by all the flashing lights, noise and smoke for a moment as it finished its meal. Then it calmly pulled out a six-shooter pistol and started firing back at us. We were all stunned at the intelligence of this reptile which was using our own human weapon against us. We figured it only knew how to use a small pistol. Next thing, he pulled out a shotgun, loaded it one-handed like Arnold in Terminator and continued firing at us. We then put down our arms and started running away, but all in the same direction. We had to keep our own guns away from the reptile, since he would gain another weapon for each one of us he caught.

At this point we were reduced to running about, only pausing to throw empty coca cola bottles, – (the Gods had gone crazy), at him as he continued firing his shotgun and roaring at us though the dust storm. Then I woke up.