South Korean auto company Kia has confirmed that it is to produce passenger vehicles in Ethiopia
In another boost for the emerging African car industry, South Korean auto company Kia has confirmed that it is to assemble passenger vehicles in Ethiopia and is also considering other plants elsewhere on the continent.
The announcement comes just weeks after Volkswagen said it would be producing the Polo Vivo small passenger car in Kenya in an effort to achieve more market penetration for the brand in East Africa. Both moves are good news for consumers and the regional economy, as well as an affirmation of faith in Africa’s future growth by two of the world’s biggest automotive brands.
Speaking in Addis Ababa recently, senior Kia executive Soon Nam Lee told Reuters news agency: “It is important to penetrate the African market. We are also looking at the prospects of opening similar plants in Algeria and other countries.” The company already has a plant in Nigeria.
The Ethiopian project is a joint venture with local company Belayab Motors and 3 000 vehicles a year will be produced, with the potential to rise to 9 000 depending on demand.
According to Reuters, Ethiopia produces about 8 000 commercial and other vehicles a year for the home market, about a quarter of which are cars. Among those present are Chinese brands Lifan and Geely.
Speaking at the announcement of Volkswagen’s new assembly plant in Kenya in mid-September, VW executive Thomas Schafer noted: “We believe that Kenya has got the potential to develop a very big fully-fledged automotive industry. The East African Community has got the potential and today is the first step in this direction that we want to take with our passenger cars.”
South Africa is the biggest producer of vehicles on the continent, with many of those being exported to other parts of Africa.