PSA establishes itself in Morocco for a "commercial offensive" in Africa.
24 June 2015
Read by 3017 persons
Rabat - To begin a "commercial offensive" in Africa, PSA Peugeot Citroën announced Friday that it would open a factory in Morocco in 2019, a 557 million euro investment with an initial capacity of 90,000 vehicles per year.
This industrial project, planned near Kenitra north of the capital Rabat to meet the "needs of the region and Moroccan customers," is part of PSA's project to make the Africa and Middle East region "the third pillar of (its) growth" after Europe and China, the company specified.
The chairman of the PSA management board, Carlos Tavares, signed an industrial agreement Friday afternoon with the Moroccan Minister of Industry, Moulay Hafid El Alamy, in the presence of King Mohammed VI at the royal palace in Rabat.
The factory "will assemble engines and vehicles from segment B and C from 2019," i.e., compact and medium-sized cars, the heart of the Moroccan market. "This industrial unit will reach a production of 200,000 units in the long term, when commercial demand justifies it," according to PSA.
The factory should represent 4,500 direct jobs at full capacity and 20,000 indirect jobs, particularly among suppliers, according to Mr. El Alamy. He mentioned an integration rate, or parts manufactured locally, of 60%, destined to rise to 80%.
With this project, which had been revealed by a union source Friday morning, without details on the amount of investment - which the company will share with Moroccan public investors -, PSA wants to "prepare today the conditions for achieving the commercial ambition of one million vehicles in the Africa-Middle East region by 2025," when the total market in the area will reach eight million units according to the company.
Mr. Tavares, speaking to journalists in Rabat, mentioned a "profitable growth plan" for PSA, which will follow the current "back in the race" plan to rebuild the company's fundamentals. The company nearly went bankrupt in 2014 and owed its salvation only to the arrival of the French state and the Chinese company Dongfeng.
The group plans to sell 200,000 units this year in the Africa-Middle East zone and the establishment in Morocco will launch a "commercial offensive" according to Mr. Tavares.
- Free zone -
PSA, he recalled, maintains a "historic, if not emotional, relationship" with Africa.
If it respects its roadmap, PSA will begin producing cars in Morocco seven years after its French rival Renault, which started its Tangier (north) plant in 2012, an announcement which at the time sparked controversy in France on the subject of relocation.
It produces 90% for the export of low-cost vehicles, and has allowed the development of a network of subcontractors and suppliers in the region from which PSA will benefit, noted Mr. Tavares on Friday.
In France, fearing that part of PSA's Moroccan production would end up on European markets, the CGT reacted with mistrust, stating that while it "has no reason to oppose the construction of factories around the world, in Morocco or elsewhere," it "will oppose with all its might that employees, here in France and Europe, pay the price."
Like Renault in Tangier, PSA will benefit from a free zone in Kenitra. The region will also be equipped with a deep-water port, facilitating the export of vehicles by sea to African countries that have concluded customs agreements with Morocco.
In addition to these advantages, the Cherifian kingdom is a logical choice for the establishment of a car manufacturer, explains Flavien Neuvy, director of the Cetelem Automobile Observatory, to AFP.
"It is a country that offers a certain political stability. From the point of view of construction and labor costs, it is well placed," he lists. Ford announced at the end of May that it would also strengthen its presence in Morocco, with the aim of doubling the number of parts it acquires locally.
Speaking to the press, the Moroccan Minister of Industry mentioned the interest of other manufacturers... before slipping the names of Ford and the German Volkswagen in passing.
Mr. Tavares also confirmed that discussions were underway for an industrial establishment of PSA in Algeria. Renault has already taken the plunge by inaugurating a factory near Oran at the end of 2014.
AFP.
Lexpansion.lexpress.fr
Published on June 19, 2015.
Posted online on June 24, 2015.
This industrial project, planned near Kenitra north of the capital Rabat to meet the "needs of the region and Moroccan customers," is part of PSA's project to make the Africa and Middle East region "the third pillar of (its) growth" after Europe and China, the company specified.
The chairman of the PSA management board, Carlos Tavares, signed an industrial agreement Friday afternoon with the Moroccan Minister of Industry, Moulay Hafid El Alamy, in the presence of King Mohammed VI at the royal palace in Rabat.
The factory "will assemble engines and vehicles from segment B and C from 2019," i.e., compact and medium-sized cars, the heart of the Moroccan market. "This industrial unit will reach a production of 200,000 units in the long term, when commercial demand justifies it," according to PSA.
The factory should represent 4,500 direct jobs at full capacity and 20,000 indirect jobs, particularly among suppliers, according to Mr. El Alamy. He mentioned an integration rate, or parts manufactured locally, of 60%, destined to rise to 80%.
With this project, which had been revealed by a union source Friday morning, without details on the amount of investment - which the company will share with Moroccan public investors -, PSA wants to "prepare today the conditions for achieving the commercial ambition of one million vehicles in the Africa-Middle East region by 2025," when the total market in the area will reach eight million units according to the company.
Mr. Tavares, speaking to journalists in Rabat, mentioned a "profitable growth plan" for PSA, which will follow the current "back in the race" plan to rebuild the company's fundamentals. The company nearly went bankrupt in 2014 and owed its salvation only to the arrival of the French state and the Chinese company Dongfeng.
The group plans to sell 200,000 units this year in the Africa-Middle East zone and the establishment in Morocco will launch a "commercial offensive" according to Mr. Tavares.
- Free zone -
PSA, he recalled, maintains a "historic, if not emotional, relationship" with Africa.
If it respects its roadmap, PSA will begin producing cars in Morocco seven years after its French rival Renault, which started its Tangier (north) plant in 2012, an announcement which at the time sparked controversy in France on the subject of relocation.
It produces 90% for the export of low-cost vehicles, and has allowed the development of a network of subcontractors and suppliers in the region from which PSA will benefit, noted Mr. Tavares on Friday.
In France, fearing that part of PSA's Moroccan production would end up on European markets, the CGT reacted with mistrust, stating that while it "has no reason to oppose the construction of factories around the world, in Morocco or elsewhere," it "will oppose with all its might that employees, here in France and Europe, pay the price."
Like Renault in Tangier, PSA will benefit from a free zone in Kenitra. The region will also be equipped with a deep-water port, facilitating the export of vehicles by sea to African countries that have concluded customs agreements with Morocco.
In addition to these advantages, the Cherifian kingdom is a logical choice for the establishment of a car manufacturer, explains Flavien Neuvy, director of the Cetelem Automobile Observatory, to AFP.
"It is a country that offers a certain political stability. From the point of view of construction and labor costs, it is well placed," he lists. Ford announced at the end of May that it would also strengthen its presence in Morocco, with the aim of doubling the number of parts it acquires locally.
Speaking to the press, the Moroccan Minister of Industry mentioned the interest of other manufacturers... before slipping the names of Ford and the German Volkswagen in passing.
Mr. Tavares also confirmed that discussions were underway for an industrial establishment of PSA in Algeria. Renault has already taken the plunge by inaugurating a factory near Oran at the end of 2014.
AFP.
Lexpansion.lexpress.fr
Published on June 19, 2015.
Posted online on June 24, 2015.
