Africa must shift gears from imports to industry
By Google News Motors ·
Africa’s automotive opportunity is sub-stantial. The challenge is to turn it into factories, suppliers, jobs and affordable mobility. The African Continental Free Trade Agreement (AfCFTA) provides a framework for doing so but its success will depend on what governments and industry build together. Africa remains one of the world’s most significant untapped automotive growth opportunities.
Low motorisation, a growing population and accelerating urbanisation create an expanding need for mobility.
Yet demographic potential does not automatically become demand for new vehicles. Affordability, access to finance and the cost of ownership will determine how much of that opportunity can be realised.
Africa accounts for only a small share of global automotive production. Yet it possesses many of the fundamentals for growth, including established manufacturing centres, mineral resources, and a rapidly expanding population.
The opportunity now lies in strengthening regional integration and value chains to unlock this potential at scale.
This was central to the discussions at the Africa Automotive Investment Forum in Alamein, Egypt, earlier this month. With automotive rules of origin now agreed under the AfCFTA, the task is to translate that framework into investment, production and employment.
Few industries connect as many parts of an economy as automotive manufacturing. A vehicle plant creates demand for components, metals, plastics, glass, textiles, electronics, logistics, energy, finance, training and retail infrastructure. This makes the sector a practical test of the AfCFTA’s promise: enabling African countries to manufacture, trade and create value together.
For automotive, that means a hub-and-spoke model. Not every country can or should assemble complete vehicles. Assembly requires scale, policy certainty, infrastructure, skills and access to large markets. But participation in the industry need not begin and end with an assembly plant.
One hub might assemble vehicles while suppliers elsewhere produce wiring harnesses, upholstery, tyres, glass, batteries or plastic components. Other countries can pro-cess minerals for future mobility. Logistics corridors, ports, distribution centres, dealer networks, finance providers and training institutions all form part of the same chain.
The proposed automotive pact between the Southern African Customs Union and Egypt, outlined at Alamein, illustrates this approach. Its emphasis on complementary pro-duction and supplier development offers a way to connect industrial capabilities across regions.
It remains a proposal but the principle matters: integration should create viable production networks rather than duplicate small assembly operations.
Scale is fundamental. Africa cannot build a globally competitive automotive industry while its market remains divided by incompatible standards, homologation requirements and cumbersome customs procedures. It must increasingly operate as a connected market.
Agreed rules of origin are an important foundation. They must now be implemented consistently, alongside aligned standards, efficient borders and predictable industrial policies. A component made in one African country should reach an assembly operation in another efficiently. A vehicle manufactured on the continent should not face unnecessary regulatory duplication at every border.
Stellantis can contribute through its manufacturing operations in Morocco and Algeria and its commercial and…
Originally published by Google News Motors
