São Paulo – Volkswagen plans on having a factory in Algeria, according to information published this Wednesday (5th) by the L’Expression newspaper and the DZ Autos e-magazine, both in the Arab country. According to the two media vehicles, the project involves investment of US$ 150 million.
The proposal provides that the German automaker will hold a 49% stake in the business. The remaining 51% should be divided among the Algerian government, through its National Investment Fund, and the Sovac company, which represents the brand in the North Africa country.
According to L’Expression, at least two meetings have been held between the interested parties to address the matter, and a third one should take place in Germany this month.
According to the project, in the first phase, the Polo and Polo Classic models may be manufactured, and later on, the unit should also start making utilitarian vehicles.
The proposal also holds that the parts used should reach a nationalization rate of 40% within 30 months of the beginning of operations. For such, according to L’Expression, a local parts supply chain will need to be developed.
The Algerian minister of Industry, Mohamed Benmeradi, had already addressed the topic in December. “Volkswagen is adamant about coming [to Algeria],” said he, according to Algérie Presse Service (APS), the country’s government news agency. “We have had interesting talks with the [VW] group,” he added.
Renault
Renault is also interested in having a factory in Algeria. According to the APS, negotiations between the French carmaker and the Algerian government are progressing. Similar to VW’s case, a new meeting to address the matter should take place this month. The project provides for a unit with a production capacity of 75,000 vehicles per year.
According to L’Expression, Algeria is the second largest market for the industry in Africa, after South Africa, with approximately 200,000 vehicles sold per year. According to the Reuters news agency, the country imported 67,800 vehicles in the first half of last year. In 2009, Renault alone sold over 50,000 units in Algeria, a figure equivalent to 23.5% of the market, according to Reuters.
*Translated by Gabriel Pomerancblum
