Morocco's booming car industry
28 February 2014
Read by 1726 persons
The Moroccan automotive industry, like the aeronautical components sector, has seen remarkable growth over the past ten years, writes the Oxford Business Group in a recently published study.
Morocco now has hundreds of manufacturing companies producing a wide range of products, from family sedans to aircraft wiring, adds the OBG analysis, specifying that the public authorities are seeking to attract more car manufacturers to the kingdom, offering an attractive tax system, a highly skilled workforce and a chain of spare parts suppliers and subcontractors.
According to figures published by the International Organization of Motor Vehicle Manufacturers in 2012, cited by the OBG, Morocco produced a total of 108,743 vehicles, an increase of 83% compared to the previous year.
The Kingdom is thus positioned as the leading car manufacturer in North Africa (a title held in 2011 by Egypt), and the second in Africa, behind South Africa. The value of automotive industry exports increased by 17.5% year-on-year in the first nine months of 2013 and vehicle sales increased by 58.3%, reaching 8 billion dirhams (963 million euros), according to the Office des Changes.
According to OBG experts, production and exports should continue to rise even more sharply thanks to the recent launch of a new production line by Renault, majority shareholder in the two main car assembly plants: the Société marocaine de constructions automobiles (Somaca), near Casablanca, which the French group owns 80%, and a plant in Melloussa in the Tanger Free Zone, owned by Renault at 52.4% and by the Caisse de Dépôt et de Gestion (CDG), a public financial institution, at 47.6%.
According to OBG, the Melloussa site, where Dacia cars, Renault's low-cost vehicle brand, are manufactured, underwent a major expansion last October, with the launch of a second line that doubles the plant's capacity to 340,000 units, making it the largest car plant in Africa.
The installation of this second line at the Melloussa site cost around 400 million euros, bringing the total investment received by the Melloussa site to nearly 1.1 billion euros, the OBG experts point out.
Thanks to such expansions, Morocco is becoming one of the largest car manufacturers, says the economic intelligence firm's analysis, citing a recent PricewaterhouseCoopers report placing Morocco 19th in the world ranking of vehicle assemblers by 2017.
In addition to creating jobs for the local population, the Melloussa plant is also synonymous with growth for Moroccan exports, as most of the plant's production is destined for foreign markets, the OBG study argues.
According to Renault Group estimates, full-capacity production at the site could represent 10% of Morocco's total exports by value – even if some components used at the site for vehicle production are imported, which will partially mitigate the plant's impact on the trade balance.
Currently, only Renault brand vehicles are “fully manufactured” in Morocco, but the Minister of Industry, Moulay Hafid Elalamy, stated last June that the State expects another major name in the automotive industry to set up in Morocco in less than three years.
According to the OBG, Morocco offers many advantages to car manufacturers, including an extremely competitive labor cost, a strategic geographical location and good transport infrastructure that allows easy export to Western Europe, the Mediterranean region and sub-Saharan Africa, a booming market.
In addition to the attractive conditions offered to investors, car manufacturers following Renault's example will be able to benefit from the pool of skilled workers that has been created, as well as a network of nearly 30 subcontractors and suppliers, the OBG experts point out, mentioning the interest expressed by some major car manufacturers in setting up in Morocco.
Lematin.ma
Published on February 26, 2014.
Posted online on February 28, 2014.
Morocco now has hundreds of manufacturing companies producing a wide range of products, from family sedans to aircraft wiring, adds the OBG analysis, specifying that the public authorities are seeking to attract more car manufacturers to the kingdom, offering an attractive tax system, a highly skilled workforce and a chain of spare parts suppliers and subcontractors.
According to figures published by the International Organization of Motor Vehicle Manufacturers in 2012, cited by the OBG, Morocco produced a total of 108,743 vehicles, an increase of 83% compared to the previous year.
The Kingdom is thus positioned as the leading car manufacturer in North Africa (a title held in 2011 by Egypt), and the second in Africa, behind South Africa. The value of automotive industry exports increased by 17.5% year-on-year in the first nine months of 2013 and vehicle sales increased by 58.3%, reaching 8 billion dirhams (963 million euros), according to the Office des Changes.
According to OBG experts, production and exports should continue to rise even more sharply thanks to the recent launch of a new production line by Renault, majority shareholder in the two main car assembly plants: the Société marocaine de constructions automobiles (Somaca), near Casablanca, which the French group owns 80%, and a plant in Melloussa in the Tanger Free Zone, owned by Renault at 52.4% and by the Caisse de Dépôt et de Gestion (CDG), a public financial institution, at 47.6%.
According to OBG, the Melloussa site, where Dacia cars, Renault's low-cost vehicle brand, are manufactured, underwent a major expansion last October, with the launch of a second line that doubles the plant's capacity to 340,000 units, making it the largest car plant in Africa.
The installation of this second line at the Melloussa site cost around 400 million euros, bringing the total investment received by the Melloussa site to nearly 1.1 billion euros, the OBG experts point out.
Thanks to such expansions, Morocco is becoming one of the largest car manufacturers, says the economic intelligence firm's analysis, citing a recent PricewaterhouseCoopers report placing Morocco 19th in the world ranking of vehicle assemblers by 2017.
In addition to creating jobs for the local population, the Melloussa plant is also synonymous with growth for Moroccan exports, as most of the plant's production is destined for foreign markets, the OBG study argues.
According to Renault Group estimates, full-capacity production at the site could represent 10% of Morocco's total exports by value – even if some components used at the site for vehicle production are imported, which will partially mitigate the plant's impact on the trade balance.
Currently, only Renault brand vehicles are “fully manufactured” in Morocco, but the Minister of Industry, Moulay Hafid Elalamy, stated last June that the State expects another major name in the automotive industry to set up in Morocco in less than three years.
According to the OBG, Morocco offers many advantages to car manufacturers, including an extremely competitive labor cost, a strategic geographical location and good transport infrastructure that allows easy export to Western Europe, the Mediterranean region and sub-Saharan Africa, a booming market.
In addition to the attractive conditions offered to investors, car manufacturers following Renault's example will be able to benefit from the pool of skilled workers that has been created, as well as a network of nearly 30 subcontractors and suppliers, the OBG experts point out, mentioning the interest expressed by some major car manufacturers in setting up in Morocco.
Lematin.ma
Published on February 26, 2014.
Posted online on February 28, 2014.
