VW Signs MoU with Ethiopia for New Assembly Facility

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volkswagenVolkswagen (VW) signed a Memorandum of Understanding with the Ethiopian government with the intent to “collaborate and deliver a joint vision for the development of an automotive industry in the country.”

This includes the possibility of establishing a Volkswagen vehicle assembly facility in Ethiopia.

This makes Ethiopia the third country in Sub-Saharan Africa to sign an MoU with VW, after Ghana and Nigeria. The automaker already has vehicle assembly plants in Algeria, Kenya, Rwanda and South Africa.

The MoU was signed by Abebe Alemayehu, commissioner of the Ethiopian Investment Commission (EIC), and Thomas Schaefer, head of Volkswagen for Sub-Saharan Africa. Present during the signing ceremony was also Ahmed Shide, the Ethiopian minister of finance and economic cooperation, and also Frank-Walter Steinmeier, president of the federal republic of Germany.

According to Volkswagen, the MoU sets the path for their company and the Ethiopian government to begin a “high-level and technical cooperation, which is integral to the development of an automotive industry and policy framework.” The document lays down four pillars as pivotal to the development of the Ethiopian automotive industry: the establishment of a vehicle assembly facility, the localization of automotive components, and the introduction of mobility concepts (such as app-based car sharing and ride hailing) and the opening of a local skills development training center.

Thomas Schaefer, speaking on the occasion, said, “Our Sub-Sahara Africa strategy is gaining momentum with the signing of the third MoU in the last six months. We are grateful for the support and vision of the Ethiopian government in identifying the automotive sector as one of the key manufacturing industries that can help the country to realize its Vision 2025 goals.”

“As one of the fastest growing economies, and with the second highest population in the continent, Ethiopia is an ideal country to advance our Sub-Sahara Africa development strategy. Additionally, Volkswagen intends on tapping into existing expertise and strategic resources in Ethiopia to establish a thriving automotive components industry,” he further noted.

Headquartered in Wolfsburg, Germany, Volkswagen was established in 1937, and was the largest automaker in the world by sales in 2016 and 2017.

Sources: Volkswagen News, Car Magazine

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