There was a significant decrease in motorcycle purchases in 2023, reaching levels not seen since 2008, primarily due to elevated taxes and soaring fuel prices.
According to data from the Kenya National Bureau of Statistics (KNBS), motorcycle purchases plummeted by 52.6% to 62,338 in 2023 from 113,513 in 2022.
This decline was attributed to the imposition of various levies, such as the doubling of value-added tax (VAT) on petroleum products. Consequently, many motorcycle operators found it less profitable as they struggled to access fuel.
The trend of increasing motorcycle purchases, which had been observed since the government eliminated import taxes on these vehicles in 2008, was interrupted in 2023.
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This marked the second consecutive year of declining purchases, following a more than fifty percent decrease from the 285,203 units bought in 2021.
The government’s decision to raise VAT led to a reduction in demand, resulting in fuel consumption dropping to its lowest point in five years during the latter half of 2023. Concurrently, there was also a decrease in the purchase of passenger cars.
The registration of new saloon cars decreased by 13.5%, while station wagons saw a two percent decline, and vans experienced an 18.2% drop.
Despite these declines, there was a notable increase in the registration of commercial vehicles, indicating a growing reliance on mass public transportation due to the high cost of living and fuel prices.
