Volkswagen signs MoU with Ethiopia to boost auto industry

To “collaborate and deliver a joint vision for the development of an automotive industry in the country”, Volkswagen has signed a Memorandum of Understanding with the government of Ethiopia, including the possible establishment of a vehicle assembly facility.

Volkswagen will concentrate on four key pillars: the introduction of a vehicle assembly facility, localization of automotive components, establishment of mobility concepts such as app-based car sharing and ride hailing as well as the starting of a training center. Volkswagen will work mainly with the Ethiopian higher education and training institutions for skills development and capacity building of local talent.

Schaefer said: “As one of the rapid growing economies and with the second highest population in the continent, Ethiopia is an ideal country to lead our Sub-Saharan Africa development strategy. Additionally, Volkswagen aims on tapping into existing expertise and strategic resources in Ethiopian to enhance to establish a thriving automotive components industry.”

Ethiopia becomes the third country in Sub-Saharan Africa to sign a MOU with Volkswagen. It follows Ghana and Nigeria who combinely signed MoUs with Volkswagen in August 2018. In Ghana, Volkswagen will establish a vehicle assembly facility and conduct a practicable study for an integrated mobility solutions idea. In Nigeria, Volkswagen started a phased approach of vehicle assembly with long term view of establishing Nigeria as an automotive center in West Africa.

Volkswagen has been producing vehicles in South Africa since 1951. In Africa, Volkswagen also has vehicle assembly operations in Algeria, Kenya and Rwanda.

Under its TRANSFORM 2025+ brand strategy, Volkswagen is strengthening the regions and focusing on new upcoming markets. The Sub- Saharan Africa region plays a very important role. Although the African automotive market is relatively small today, the region has great opportunities to develop into an automotive growth market of the future.
 

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