Chatha Motors is to be carved out of Coin Ltd inland car depot to become a fully fledged independent company. With its new home located in Kyambogo, the company intends to establish a showroom that will accommodate up to 1,000 cars, far above the 400 cars that it currently stocks.

The development is set to increase government revenue and also create employment opportunities for Ugandans. Amongst car dealers, Chatha Motors was only second to Toyota Uganda Ltd in terms of revenue contribution to government during Financial Year 2007. The company paid Shs 5.6bn compared to Toyota Uganda's Shs 8.8bn.

According to Tariq Muhammad Javaid, the Chief Executive, $7m (Shs 11.8bn) is to be invested in the project that will also see the company start to make simple car accessories like brake parts, filters, etc, and only import parts that it may not be in position to make locally, in order to boost its after sale services.

Javaid says the project to be implemented in two phases will see the company also start an assembly plant and a vocational training institute that will train people in modern car repair and maintenance.

"We realised there are many school dropouts who can benefit from this arrangement," Javaid said. In the first phase to start this year, according to Javaid, the company will set up a bigger showroom, a workshop for customer care and start to make accessories. In the second phase to kick off in ten years, the company will start an assembly plant and a vocational training institution.

Currently, good vehicle body building is done in Nairobi, Kenya and Chatha looks forward to also tap into this market.

Chatha which started business in 2001 to provide vehicles to government agencies, the corporate sector and general public has mobilized resources, according to Javaid, to effectively meet its laid out vision.

The company imports vehicles of model 2000-07 and gives a three month warranty on the engine, gear box and differential. Because the company sells used vehicles, any detected faults on delivery are immediately handled. The vehicles are serviced before delivery.

The company partnered with banks to extend leasing and vehicle loans to their customers. Currently, the company partners with Barclays Bank, Centenary Bank, Stanbic Bank, Post Bank, Bank of Africa and Dfcu Bank.

With this scheme, Chatha also works directly with bigger companies which it supplies with vehicles to enable their workers own cars at affordable terms. One can pay for a car over a period of 3 to 4 years with an initial deposit of 20-30%, depending on the bank that you deal with.