Egypt’s leading automotive assembler, Ghabbour Auto (GB Auto) motors has launched a new facility to assemble Hong Kong-based Geely Automobile Holding cars.
The newly launched facility doubles the capacity of GB Autos prima plant, thereby giving the biggest car importer and distributor in the Middle East and North Africa, the range of assembling up to 70,000 cars from 30,000 cars a year.
GA Autos controls a third of the Egyptian car market and it is the only listed automobile company on the Egyptian Exchange.
The Egyptian automobile company had signed an agreement in February with Geely Automobile to begin distributing Geely cars in North Africa. The agreement also include giving the automobile company the power to assemble cars using complete knock Down (CKD) kits supplied by Geely.
“The facility has already produced the first locally assembled Geely Emgrand 7 models,” the company said on Monday.
Geely’s Emgrand 7 is intended to replace the medium-size Hyundai Verna which has achieved significant success in the Egyptian market. GB Auto will cease manufacturing the Verna by the end of 2013.
The automotive sector in Egypt is heavily protected by the government. Automobiles imported to Egypt are burdened with a basic tariff of 40 per cent and a sales tax of 15 percent. For cars with engines bigger than 1.6 cc, the tariff goes up to 125 percent.
The revamped Prima plant is a state-of-the-art facility with latest-generation quality control procedures, fully automated conveyer systems, and the first fully robotic paint shop in the Middle East and North Africa, the company said in a statement.
Chairman and CEO of GB Auto, Raouf Ghabbour, said “Our significant investment in the Prima plant reflects our confidence in the outstanding long-term fundamentals of the Egyptian automotive market, which reflects a motorization rate far below both regional and emerging market averages. The revamped Prima will allow us to serve the Egyptian market with high-quality locally assembled products at a range of price points, making possible automotive ownership for a wider socio-economic cross section. We are honored to be introducing this high-quality Chinese brand to the Arab world’s most populous nation.”
