CMC Motors Group is closing its operations in Kenya, Tanzania, and Uganda after forty years in East Africa’s automotive and agricultural industries, leaving hundreds of its workers facing an uncertain future. CMC Motors Group is renowned for its New Holland brands. Why CMC Motors Group quit East African market The international company, which was purchased by the Al-Futtaim Group of Dubai in 2014, blamed the decision on persistent market issues, such as economic pressures, currency depreciation, and growing operating costs. In a statement on Friday, January 17, the firm noted that a thorough business environment assessment preceded the decision. “CMC Motors Group has announced its decision to gradually wind down operations in Kenya, Tanzania and Uganda in full compliance with local regulations and distributorship agreements.
This decision follows a thorough evaluation of the business in light of sustained market challenges, including economic pressures, currency depreciation and rising operational costs,” it explained. The company is one of the largest car assemblers in Kenya and has been offering agricultural and mechanical solutions to farmers. Job losses loom CMC Group said its restructuring efforts did not bear fruit, forcing it to shut down operations. The company reaffirmed its dedication to helping staff members through the changeover and ensuring a smooth transition. “Despite restructuring efforts and a transformation program initiated in 2023, the market conditions have not provided a sustainable path forward. The company is committed to supporting its employees during the transition and will ensure a smooth and orderly wind-down in adherence to all relevant agreements and regulations.”
CMC fires 169 employees In April 2023, CMC declared 169 employees redundant after three car brands terminated their contract with the motor dealer. CMC, which sold Ford, Suzuki, and Mazda car brands, shifted to agricultural mechanisation to support food security. The company’s main dealership brand in this sector is the New Holland Tractors franchise. The exit of Ford dealt the company a blow since the brand reported 78.7% of its total sales in 2022. Which other companies exited Kenyan market? Kenya’s business environment significantly changed in 2024 when several well-known companies in various sectors shut down operations.
Ukwala Supermarket Ltd wrapped up the liquidation process on Friday, December 20, 2024. Its debt had grown to nearly KSh 1 billion against assets worth KSh 19 million. In June 2024, High Court Judge Alfred Mabeya ordered the liquidation of Blue Shield Insurance. The order came after Mabeya concurred with the Insurance Regulatory Authority (IRA) that the insurer with liabilities exceeding KSh 800 million could not be resuscitated. Elsewhere, car assembly firm Mobius Motors closed shop on Monday, August 5, 2024.
by Japhet Ruto
