Between 2014 and 2018, Morocco’s automotive industry added 11,611 jobs to the country’s labour market, representing nearly twenty-nine percent of 405,408 jobs created in that time. For comparison, the next best sector, textiles, provided about 79,000 jobs. Without a doubt, the automotive industry is relevant to the future of the Moroccan economy. And so, news that PSA Group, French mega car manufacturer, has opened its Kenitra plant in the country will set off excitement bells in keen watchers of the economy.
This launch is the denouement of a 2015 agreement signed by Carlos Tavares, PSA Peugeot Citroen CEO, and Moulay Hafid Elalamy, Minister of Industry, Investment, Trade, and Digital Economy. But the finish certainly looks better than the initial plan, with the plant expected to produce 200, 000 cars yearly by next year, doubling the more modest 100,000 planned in 2015.
Another statistic that will be impacted by this plant is the number of jobs at PSA Group Morocco, expected to quintuple by the end of this year, adding some 1900 jobs to the 350 that existed in 2017, apart from 20,000 indirect jobs. This number is expected to reach 4,000 by 2023. Morocco’s export numbers will also see a significant increase, as PSA intends to send ninety percent of Kenitra’s production to about 80 markets abroad, translating to increased foreign exchange for the North African nation. All of which means that Morocco’s current position as the leader in car production in the MENA region is secured for a few more years.
“At the heart of the Middle East and Africa region, Morocco is a historic and strategic market for our Group and its four brands, Peugeot, Citron, DS and Opel. We are forging a unique partnership in Morocco’s automotive industry, thanks to the help of all our partners and the support of the Moroccan authorities,” said Groupe PSA’s Executive VP for MENA region, Jean-Christophe Quèmard.
Minister Elalamy was impressed by the execution of a well-laid plan, as he praised PSA’s punctuality in delivery as well as the quality of the installations. The minister’s address prompted Quèmard to reaffirm his company’s choice of Morocco as the site for PSA’s Regional Decision Center, as he also disclosed plans to install a Research & Development Center.
Morocco has had both the good fortune and habit of drawing hefty industry players to set up shop in the country’s free industrial zone, which is in Kenitra, a city in Northern Morocco, home to over 431,000 people. In April this year, Canadian automotive supplier Magna opened a mirrors construction facility. Within that month, Japanese company Mitsui Kinzoku opened a monstrous facility for making car locks, the first of its kind in Africa.
A month later, French automotive supplier Valeo inaugurated a production plant for thermal systems as well as lighting and wipers in Tangiers Automotive City. Nexteer is also in Morocco making electric power steering systems. This month, the world’s largest manufacturer of automotive aluminium wheels CITIC Dicastal moved to Morocco to make alloy wheels and other parts for automotive giants. Basically, the country has the sum of all the parts required to get a car finished.
In addition, the North African nation is lucky to be geographically situated near the mouth of Europe, where there are 600 cars per 1,000 people in 2012, and 15 million new vehicle registrations in 2017, clearly a big market. This is asides from the fact that major carmakers also record hefty profits from their Morocco hubs. Which is why at the same time plants elsewhere are shutting down, Morocco is adding new facilities. At this pace, the automotive industry’s overall contribution to the country’s economy by the end of the year would be significantly bulkier. It had contributed twenty four percent of GDP in 2017, according to Oxford Business Group.
By Caleb Ajinomoh