Future Boost for Domestic Automobile Assemblers in Ethiopia

Posted on : Wednesday , 7th October 2020

Prime Minister Abiy Ahmed's leadership said to take unprecedented measures in formulating conducive business climate for automotive industry thereby enhancing the capacity of domestic car assembling firms and putting the import substitution strategy in a good shape.

Speaking to The Ethiopian Herald, Founding CEO and Managing-Director of a local automotive firm, Marathon Motor Engineering, Melkamu Assefa said that Premier Abiy has taken viable measures in the automotive industry that is taking into account the sector's important role in advancing the current economic growth.

The CEO pointed out that the decision made by the current administration to cut the 35% excise tax levied in new cars to 5% makes newer cars more affordable to Ethiopia's growing middle-class that would have role to lessen the huge forex the country incurred to import petroleum and spare parts.

The incumbent's success in the automotive industry further witnessed by more and more skilled labor force graduated from Technical and Vocational Education and Training centers are joining the sector. "As a manifestation for the betterment in skill development programs, Marathon Motor recently handed the first-ever electric car, which is fully assembled by Ethiopian professionals, to Prime Minister Abiy."

by government's green economy, the firm pioneered to assemble electric cars locally that have zero emission of carbon dioxide and cost-efficient for individual customers and benefit the national economy in cutting short the huge petroleum and diesel expenses. Electric cars are also easily chargeable in charging stations as well as household electric supply and could travel up to 300 kilo meters per a single charge.

He pointed out that his company is hopeful to capitalize on the government's commitment to set enabling business climate for domestic car assembling plants and envisioned to commence mass production of electric viechles at a more affordable price for the middle-incomes.
 

The CEO highlighted that paving the way to small and medium enterprises to produce car spare parts and equipping them with up-to-date knowledge and technological caliber is a key factor to lessen the pressing forex expense the country incurred to import those items from global market. The government also needs to ease allocation of forex and reduce excise tax and other related dues to make new cars more affordable to the greater portion of the society thereby stimulating the domestic automotive business. Estimates indicated that currently more than 1.3 million registered vehicles in Ethiopia