Auto: Chinese invade French parts of Africa
The Chinese are accelerating their penetration of the car market
Peugeot has certainly tried to reconnect in the last two years, by offering a simple pick-up. Baptized Landtrek, the latter was supposed to take the torch of the 504. But this vehicle is nothing more than a… Chinese model from the manufacturer Changan, a former partner of the PSA group in the former Middle Kingdom.
Intended for emerging countries, this Landtrek is notably sold in Morocco, Tunisia, Ghana, Senegal and South Africa. “In the automobile, we have lost ground to the benefit of the Indians and the Chinese, who sell cheaper cars and are therefore more adapted to the African market”, underlined an expert on Africa, who worked at Bolloré.
In Côte d’Ivoire, Renault holds only 7% of the local market (in 2021), according to unofficial inter-manufacturer statistics, behind the Japanese Suzuki, Toyota, Mitsubishi, the Korean Hyundai-Kia. Stellantis (Peugeot and Citroën, along with Fiat and Jeep) came in 8th (5.3%) behind especially in… Chinese Great Wall.
In Congo, it is Japanese Toyota that dominates (15.5% in the first ten months of 2022) as in the neighboring Democratic Republic of Congo (27%). Same thing in Cameroon (13% for Toyota) in Kenya (13%) where Peugeot however won the East African Safari several times in the 60s and 70s with the 404 and 504. In South Africa, Toyota took the quarter of the market (over ten months 2022).
Without actually threatening the Japanese, the Chinese are increasing with 25% penetration in Egypt (all brands combined), 15% in Tunisia, 6% in South Africa. And the Indians followed. Led by 4×4 manufacturer Mahindra, they have already claimed 6% of the Mozambique market, 4% in Tunisia, 3% in South Africa and Namibia.
Develop in Africa
So, Berezina for the French? Nope. They are still valiantly defending their positions in some countries. Top: Morocco. It is even their El Dorado. Dacia (Romanian subsidiary of Renault) is in a strong position there, with 25% of the automotive cake (as of September 2022), ahead of… the Renault brand (20%). Peugeot (7%) and Citroën (5%) are also significant players. Or 57% market share for French as a whole.
In the very difficult Algerian market, Renault is also leading (in 2021). Stellantis is for its part first tied (to Toyota) in Angola, in Egypt – thanks it is true to the Fiat brand traditionally well established in the area -, in Gabon. But, this is small compared to historical scores.
The French, however, are aware that they have to stimulate themselves in the African market, even though most of these countries are very small, rather second-hand markets, with frequent problems with the conditions of trade. So Stellantis announced in November “an investment of more than 300 million euros in the Kenitra site”, the Moroccan factory inaugurated in 2019 with an initial investment of 550 million euros. Objective of the extension: double the production capacity to 400,000 units per year.
In this ramp-up, the site located in a free zone between Rabat and Tangier, which produces Peugeot 208s and Citroën Ami and Opel Rocks-e electric carts, mainly intended for export to Western Europe, will intends to assemble at the site a new range of vehicles, more intended for Africa. And this, on the small “Smart car” platform, for local markets.
Stellantis will produce one million vehicles a year in Africa
It is a platform derived from the current Peugeot 208, but simplified to be cheaper and adapted to emerging countries. Different silhouettes are planned. Fiat brand vehicles on this same platform may join Kenitra production. This additional capacity will support the company’s growth plans in the African region (including Turkey and the Middle East). Stellantis aims for a total production capacity of one million vehicles per year by 2030. The group, which also has small assembly plants in Tunisia and Ghana, also has industrial projects in Egypt and Algeria. (for the Fiat brand).
Kenitra will compete with Renault’s Moroccan factory, which mainly makes Dacias in Tangier. Inaugurated in 20212 by Carlos Ghosn, then CEO of the group, the site of the diamond group produced Dacia Sandero and Logan, Dacia Lodgy minivan and Renault Express utility in 2021, with 6,400 people. That’s a total of 223,000 units. But, as with Kenitra at the moment, this site mainly exports to Europe. Not at all sure that the French could really hold back the Asians. Chinese and Indians have cheap and simple cars for them. Including pick-ups and off-road suitable for local tracks.