CHINESE AUTOMOBILE INDUSTRY.

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By Staff Writer

If there is one thing that the Chinese have taught the world, it is never to discount China in any given season.

Western pundits are already predicting that the new US Administration’s tariff crusade against China will criple  the robust Chinese  global economic reach.

Those who are in the know how ever will give you a cautionary wait and watch advice.

In the 1970s, when the South East Asian Tigers’ economies were on the rise, and every electronic gadget was from Japan, China was off the radar of global trade.

Fast forward to 2019.

If you had to make a random survey to determine which country is hogging the market for electronic goods in Africa  and elsewhere, Chinese goods are leading by far.

From Chinese Cellular phones, laptops, PCs TV sets, play stations, solar technology you will find these goods even in the most remote dust covered small hamlet in Africa.

Revolution and transformation appear to be themes that are universally associated more with the Chinese.

Historically, it is taken, that every nation has had to climb from the pit of primary societies to where they are today; socially, economically and politically.

China’s experience how ever has been unique in this trajectory and is still continuing.

One of the areas in which the unique Chinese character of fortitude and resilience shines through, is in the Motor vehicle industry.

Thirty years ago, no one in Africa could seriously talk of a Chinese motor industry making inroads, let alone competing seriously with the giants of motor industry long established on the continent.

By last year, Anhui Jianghuai Automobile Group Corporation, (JAC Motors,) had established a presence in 28 countries across the continent.

The Corporation recorded exports of SUVs, light-duty trucks, medium- & heavy-duty trucks, pickup trucks, vans, sedans, and motor coaches to 28 African countries.

These included, among others, Algeria, Egypt, Nigeria, Kenya, Angola, South Africa, Ghana, Ivory Coast, Congo DR. and Mozambique.

Product quality, localization, as well as effective after sales has been attributed to this successful penetration in a market otherwise known to be saturated.

JAC Motors first entered the African market in 2002, and in that time it has exported 85,000 units, expanding the scope of its sales during that time from light-duty trucks to include all of its passenger and commercial vehicles.

By 2018, JAC Motors became the second-largest Chinese automaker by export value in Nigeria and introduced their pickup and light-duty range of trucks in the well-established South African market which has been hailed by industry watchers as a significant breakthrough.

The Corporation has transited from a product exporter to a technology and capital exporter to Africa through the establishment of local plants and joint ventures in Nigeria, Sudan and Angola.

In Zambia, construction of a US$175 million motor vehicle-assembling plant by GONOW is on the cards and only awaiting  the go-ahead from the Environmental Management Authorities.

In a country where the only motor vehicle manufacturing plant closed 27 years ago, this is a significant development.

Last year, the Chinese automotive firm Beiqi Foton Motor launched an operational centre in Kenyan to facilitate its expansion across East Africa.

Prior to this development, Foton Motor had sold more than 3,500 vehicles in Kenya since entering the market in 2012.

In South Africa, the Beijing Automotive Industry Holding Company, better known by its brand name BAIC last year opened an 11 Billion rand assembly plant in Port Elizabeth.

The BAIC facility is China’s largest direct investment in Africa up to now and is set to create employment for 2,500 south Africans.

In Nigeria, Guangzhou Automobile Group have opened an assembly plant in Lagos.

The Chinese Auto mobile industry has defied odds in the African market.

Firstly, no one gave them the chance of a snowball in hell in the African market; what with the long entrenched popular brands of motor vehicles already hogging the market in Africa?

Secondly, the Chinese had to contend with the influx of second hand vehicles on the African market.

These are cheaper on average with a markup of about 30 percent the price of a brand new vehicle.

In doggedly fighting their way into the tough, uncertain African market, the Chinese have done the Africans a huge favour.

On average, for the lower and mid-market ranges of Chinese vehicles the prices are competitively lower compared to the brand new brands from Japan, US or United Kingdom.

This is helping in a way, particularly when it comes to institutional customers who may have limited budgets but would still  want to opt for brand new vehicles.

Apart from that, the African continent is home to more than 1 billion people, and an expanding middle class.

However, despite this figure, Growth of personal transport has been low with only 42 vehicles per 1,000 inhabitants, compared to the global average of 182, as per 2016 statistics.

What this means is that the 100-plus Chinese car manufacturing companies can still establish a niche for themselves on the African market.

It is evident that come what may, people will just have to get used to the Chinese on the global economic arena; they are here to stay.

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