French automotive giant PSA announced a strategic move in 2018 to commence assembly of Peugeot and Opel brands in Namibia, solidifying its commitment to tap into the Southern African Customs Union market. In partnership with the Namibian government, PSA aims to establish a robust production capacity of 5,000 vehicles per year at the Walvis Bay plant by 2020.
The Namibian Venture Unveiled
PSA's decision to assemble vehicles in Namibia was unveiled as part of a significant investment agreement with the Namibian government. The venture, set to kick off in the second half of 2018, involves the assembly of Peugeot and Opel models, initially featuring the Opel Grandland X and Peugeot 3008. However, PSA notes the flexibility to introduce additional models based on evolving customer preferences.
Production Capacity and Timeline
As per the agreement, the Walvis Bay plant is poised to achieve an annual output capacity of 5,000 vehicles by 2020. This ambitious goal signals PSA's intent to establish a formidable presence in Namibia and cater to the growing demand within the Southern African Customs Union, encompassing Botswana, Lesotho, Namibia, South Africa, and Swaziland.
Strategic Joint Enterprise with Namibia
The assembly initiative involves Peugeot forming a joint enterprise with the Namibian Development Corporation, a state-owned entity. This collaborative effort reflects a commitment to mutual growth and development, aligning with PSA's broader strategy to bolster its footprint in key markets.
Expanding into the Southern African Customs Union
The Namibian venture is strategically positioned to tap into the expanding market of the Southern African Customs Union. By introducing the Opel and Peugeot brands to this region, PSA aims to cater to the automotive needs of a diverse consumer base, capitalizing on the increasing demand for quality vehicles in the Southern African market.
PSA's Long-Term Strategy in Africa and the Middle East
The investment in Namibia aligns with Groupe PSA's overarching goal to increase sales in Africa and the Middle East. Jean-Christophe Quemard, the executive vice president for these regions, emphasized that the Namibian venture is a crucial component of PSA's long-term strategy, contributing to the ambitious target of selling one million vehicles by 2025.
Broader Investments Across the Continent
Namibia is just one piece of PSA's broader investment puzzle in Africa. The company has existing or planned investments in Algeria, Ethiopia, Iran, Kenya, Morocco, Tunisia, and Nigeria. This extensive reach underscores PSA's commitment to establishing a strong presence across diverse African markets, leveraging opportunities for growth and market penetration.
Conclusion
PSA's decision to assemble Peugeot and Opel brands in Namibia marks a strategic leap into the Southern African Customs Union market. With ambitious production goals and a commitment to flexibility in product offerings, PSA is poised to contribute significantly to the automotive landscape in Namibia and strengthen its foothold across the African continent.
