NAMIBIA has struck a N$190 million deal with Groupe PSA that will see the country assembling Opel and Peugeot vehicles at an envisaged automotive assembly factory to be set up at Walvis Bay by mid-2018.
The investment into the project is N$50 million, and the other N$140 million is the valuation of the land and building provided by Namibia.
Groupe PSA is a French company with ambitions to expand into the African and Middle East markets to sell a million vehicles by 2025.
The French company started discussions with the government in 2015 through the trade ministry to set up an assembly plant in Namibia which would produce on the first stage 5 000 vehicles annually for the Southern African Customs Union's (Sacu) market.
Namibia will through the development corporation hold 51% equity, with Groupe PSA getting 49%.
Industrialisation and enterprise development deputy permanent secretary Michael Humavindu confirmed the deal, saying the registration of the joint venture should be finalised this month.
He said the first equipment was expected by June, and the first vehicle to roll out by the end of this year.
PSA has set up production in Iran, Morocco, Algeria, Nigeria, Ethiopia, Kenya and Tunisia, and Namibia is the next target.
Humavindu, who spearheaded the project, said the envisaged plant would assemble the cars from semi-assembled kits (semi-knock down process).
He noted that Namibia is set to produce the full range of Opel and Peugeot SUV vehicles, which are the B class Opel Crossland X and Peugeot 2008, C Class Opel Crossland and Peugeot 3008, and D class Peugeot 5008.
“With this project, we are looking towards creating 50 direct jobs for Namibians, and we would look for students at the vocational training centres in Namibia. The project will also create indirect employment estimated at 200 people. The Namibia Ports authority is also keen on lending assistance regarding the project as it stands to benefit a lot from it,” Humavindu noted.
Once the vehicles have been assembled in Namibia, the joint venture will then sell them to Peugeot Citroën South Africa and Opel South Africa, respectively, as they are responsible for the distribution of Peugeot-branded and Opel-branded vehicles in the Sacu region.
Jean-Christophe Quemard, the executive vice president for the Middle East and the Africa region at PSA Groupe, said the investment is part of a long-term strategy to increase sales in Africa and the Middle East.
“This is consistent with our target to sell one million vehicles in 2025. This new capacity will serve regional markets with products in line with our Opel and Peugeot customer expectation,” he added.