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African Automotive Market to Witness USD 42.06 Billion Revenues by 2027 – Exclusive Report by Mordor Intelligence

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African Automotive Market to Witness USD 42.06 Billion Revenues by 2027 – Exclusive Report by Mordor Intelligence

June 15
01:12 2022
African Automotive Market to Witness USD 42.06 Billion Revenues by 2027 - Exclusive Report by Mordor Intelligence
Mordor Intelligence
The rising level of infrastructure in Africa is likely to aid the region’s automotive market. Western and Northern Africa is expected to drive the growth till 2023, where countries like Ghana and Morocco are expected to be the key players. Ghana aims to become a developed country by 2030. If the country meets even half the target, the Ghanaian automotive market is likely to grow at a tremendous pace, as the economic growth is directly proportional to the growth of automotive markets.

Key Highlights of the African Automotive Industry

  • The African automotive market is valued at USD 30.44 billion in 2021, and it is expected to reach USD 42.06 billion by 2027, registering a CAGR of 5.55% over the forecast period (2022 – 2027).
  • The African automotive market is dominated by manufacturers such as Volkswagen AG, Toyota Motor Corporation, Groupe Renault (including Dacia Sales), Daimler AG, Ford Motor Company, Hyundai Motor Company, and Isuzu Motors. Manufacturers are focusing on strategies to improve their business across the region.
  • The Automobile Association of Zimbabwe, along with the other members of the African Council of Touring and Automobile Clubs, called on importing and exporting countries to take action to promote safer and cleaner used vehicles in Africa. The formation of the Association of African Automotive Manufacturers (AAAM) started receiving benefits from reforms and policies. For instance, any car company that sets up a local assembly plant in Nigeria, Kenya, and Ghana, could get tax holidays of up to 10 years and duty exemptions.

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African Automotive Market Overview

Although there was a decline in the overall sales of new vehicles due to COVID-19, commercial vehicles in 2019 increased by 0.33% to 308,319 units, compared to 307,301 units sold in 2018. In 2020, Egypt witnessed an increase in new vehicle sales by 26.55% to 231,238 units compared to 182,713 units sold in 2019. The African market has one of the highest growth prospects across the world. Multinational vehicle manufacturers currently setting up production plants in Angola, Ethiopia, Ghana, Kenya, Namibia, Nigeria, Rwanda, South Africa, and other countries are a clear indicator that there is potential to boost manufacturing for the automotive market in this region. South Africa, Egypt, Morocco, and Algeria have sizeable automotive assembly and manufacturing sectors.

Contract manufacturing is another major growth factor for companies that have franchises to manufacture for the OEMs. For instance, Kenya Vehicle Manufacturers, where the government has shares, hold franchises for Mercedes-Benz, Volkswagen, and Chrysler. Another local company, AVA, assembles medium and heavy commercial vehicles for Mitsubishi and Fuso and Scania, Toyota, Hino, and Tata.

African Automotive Market – Geographical Overview

South Africa region is expected to stand as the largest automotive industry

In 2020, according to the National Association of Automobile Manufacturers of South Africa, vehicle sales in the country declined by 29.1% because of the pandemic. However, as the country is a hub for exports of passenger cars in several other parts of the world, especially Europe, the market started restoring demand and is expected to continue over the forecast period. For instance, the export sales recorded a second consecutive month of solid growth in January 2021 and at 22,771 units reflected an increase of 6,468 units, or 39,7%, compared to the 16,303 vehicles exported in January 2020.

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Recent Developments in the African Automotive Market

  • In November 2021, Toyota South Africa announced that the new Corolla Cross Hybrid compact SUV model would be produced in South Africa after Toyota made a commitment of ZAR 2.43 billion investments earlier in 2020.
  • In November 2021, Volkswagen South Africa launched the second phase of its EV strategy. The second phase of Volkswagen’s strategy will see the introduction of an all-electric ID.4 test fleet in 2022.
  • In October 2021, Nissan Motor Company announced its strategy to make its Rosslyn plant in Pretoria the light commercial vehicle (LCV) hub for its African operations, which is gaining further impetus with the assembly of semi-knocked-down kits of the new Navara pickup scheduled to commence in Ghana early next year.

Related Research and Links

List of Key Players in the African Automotive Market

  • Toyota Motor Corporation
  • Volkswagen AG
  • Groupe Renault
  • Hyundai Motor Company
  • Ford Motor Company
  • Innoson Vehicle Manufacturing Company
  • Daimler AG
  • Volvo Group
  • Isuzu Motors Ltd
  • Tata Motors Limited
  • Ashok Leyland

*List Not Exhaustive

Mordor Intelligence has segmented the African Automotive Market based on vehicle type and geography:

  • Vehicle Type (Market Size & Forecast based on Value (USD billion), 2018-2027)
    • Passenger Cars
    • Commercial Vehicles
  • Geography (Market Size & Forecast based on Value (USD billion), 2018-2027)
    • South Africa
    • Morocco
    • Algeria
    • Egypt
    • Nigeria
    • Ghana
    • Kenya
    • Rest of Africa

About Mordor Intelligence

Mordor Intelligence is a market intelligence and advisory firm. Our mission is to map complex business ecosystems across the globe to better predict butterfly effects. To date, we have partnered with 4000+ enterprises across 20 industries, to deliver precise data and actionable insights in over 6000 projects. Our domain-specific teams of research experts continuously track markets, enabling our clients to gain a competitive edge through high-quality market intelligence.

We offer fully tailored intelligence solutions to meet the unique business requirements of any organization. Our deep industry expertise coupled with cross-functional analyst teams ensures we can support the intelligence requirements of even the most specific of business problems.

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