South Korea’s Hyundai Motor Co opened a 10,000-a-year vehicle capacity assembly plant in the Ethiopian capital Addis Ababa on Thursday, its first factory in East Africa.
While second-hand vehicles dominate sales in the Horn of Africa country, Hyundai hopes locally-assembled cars could prove attractive given the cost of imports due to high taxes.
Vehicles that will roll off the assembly line at the plant just outside of the capital include passenger hatchback cars and trucks, Haile Gebrselassie, the former Olympian-turned businessman who has partnered with the South Korean firm.
Some of the cars will be exported to the region, Haile said.
“This plant is big enough (to assemble) for Kenya, Ethiopia, Somalia, Djibouti, Eritrea and Sudan,” he said.
Ethiopia produces around 10,000 commercial and other vehicles a year for its home market. It imported more than 40,000 cars in 2017, automobile traders say.
Assemblers in the country include Chinese brands Geely, FAW and BYD, as well as Lifan.
Hyundai Chief Executive Won Hee Lee said the Korean firm was drawn by Ethiopia’s growth, one of Africa’s fastest for more than a decade.
“We have good opportunities in Ethiopia. We believe the economic growth in Ethiopia will be faster than any other country in middle Africa,” he told reporters at the inauguration ceremony.