After over 40 years at the helm of driving the mechanization of the agricultural industry in East Africa, CMC Motors Group is putting the brakes on its operations in Kenya, Tanzania, and Uganda.

In a statement dated 17th January, 2025, the company has announced plans to wind down its business in these East African markets, citing "sustained market challenges, including economic pressures, currency depreciation, and rising operational costs."

CMC, which has six branches in the country, added that despite years of effort to engineer a turnaround, including a 2023 restructuring initiative aimed at revitalizing its business, the group conceded that the market dynamics left "no viable path for sustainable growth."

“For over 40 years, CMC Motors has been a key player in East Africa’s agricultural sector, providing essential mechanization solutions and unparalleled customer support. This decision was not made lightly but is the outcome of a comprehensive evaluation of our operations,” the statement read in part.

For the industry, CMC's exit could sent shockwaves across the region, particularly in the agricultural sector. With its head office in Nairobi, CMC has been running exclusive distribution of New Holland Tractors, FieldKing Farm Implements, Nardi Farm Implements and Hero motorbikes.

With outlets in Uganda and Tanzania, the company has been running arguably the largest distribution network in East Africa for sales, parts and service for a broad range of farm machinery.

For CMC, the road has grown increasingly rocky in recent years, with the company grappling with currency swings and steady rise in the cost of doing business.

Acquisition by Al-Futtaim Group

Established in 1948 in Kenya when Mr Allen and Mr Cooper came to East Africa to sell Land Rovers, CMC has evolved over the decades culminating in its acquisition by Al-Futtaim Group in 2014.

Currently, Al-Futtaim Automotive Group has footprint across 14 countries, including the United Arab Emirates, Iraq, Kenya, Pakistan, Qatar and Saudi Arabia.

While the exact timeline for the wind-down was not disclosed, the company said it will be "supporting its employees during this transition," in compliance with the law.

With the auto dealer's exit, CMC Group will be joining a growing list of multinationals that have exited East Africa's largest economy in the past year citing tough economic conditions, runaway costs, and unfavourable environment for trade.

Last year, American FMCG manufacture Procter & Gamble (P&G) announced wind down of its operations in a move that negatively impacted close to 1,000 workers.

At the same time, Australian mining giant Base Titanium unveiled plans to exit the market following what it described as the depletion of titanium ore at its location in Kwale County, leaving over 1,200 workers jobless.

In August, the shareholders of SUV manufacturer Mobius Motors agreed to liquidate the company citing weak demand amid high production costs.

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