Morocco handles European orders, South Africa focuses on brand manufacturing and regional exports, and Egypt leverages CKD (Completely Knocked Down) kits to gain local market access.
Chinese companies should separate their vehicle manufacturing, parts, battery materials, warehousing and distribution, and after-sales service operations. Heavy asset investments should primarily be located in Morocco and South Africa, while Egypt should focus on medium-sized assets such as assembly and warehousing/distribution.
Part 1: Large-scale automobile manufacturing in Africa is concentrated in three major clusters.
The African automotive industry has differentiated into three distinct sectors in terms of manufacturing capacity, export focus, market access, and aftermarket structure.
According to statistics from the International Association of Motor Vehicle Manufacturers (IAAM) in 2024, Africa produced 1.1774 million vehicles, explicitly excluding Egypt.
Of these, South Africa produced 599,755 vehicles, Morocco 559,645, and Algeria 30,108.
Morocco and South Africa together account for approximately 98.5% of Africa’s total automotive production under this category.
Large-scale vehicle manufacturing in Africa has formed a dual-center structure, while Egypt is entering a third cluster through CKD (Completely Knocked Down) assembly, government industrial assets, and localization policies.
African automotive manufacturing concentration: South Africa and Morocco form dual centers of large-scale manufacturing
Morocco: A manufacturing platform for exports to Europe
European orders constitute the main source of value for Morocco’s automotive industry.
The Moroccan Foreign Exchange Authority disclosed that in 2024, the automotive sector’s exports reached AED 157.594 billion, a year-on-year increase of 6.3%.
Of this, exports from the automotive manufacturing segment totaled AED 70.955 billion, wiring harness exports AED 53.643 billion, and powertrain exports AED 11.877 billion.
Europe accounted for 71.4% of all Morocco’s exports.
The AED 157.594 billion in automotive exports indicates that Morocco has transitioned from a vehicle assembly base to a supply chain platform for Europe.
Companies establishing factories locally need to simultaneously meet the demands of European OEM orders, customer certifications, rules of origin, carbon footprint requirements, port logistics, and delivery schedules.
The battery supply chain is strengthening this role.
The first phase of Guoxuan High-Tech’s Morocco project has a planned capacity of 20 GWh. Reuters reported in May 2025 that site preparation for the project was complete, and the first batch of products was expected to roll off the production line in the third quarter of 2026.
BTR plans a 50,000-ton cathode material production capacity in Morocco, with the first phase of 25,000 tons expected to go into operation in September 2026.
Projects by Chinese companies such as Hailiang, Shenzhen Capchem, and Zhongwei mainly focus on copper foil, electrolytes, and cathode materials.
South Africa: A hub for brand manufacturing and regional exports
South Africa boasts one of the most comprehensive vehicle manufacturing, parts, distribution, financial, and after-sales systems in Africa.
According to the South African Automotive Business Council, by 2025, South African vehicle production will reach 618,077 units, new car sales will reach 597,338 units, and vehicle exports will reach 414,271 units, with export value of automobiles and parts reaching 291 billion rand. Automotive products are exported to 154 countries, with complete vehicle exports covering 109 countries.
With exports of 291 billion rand and 414,271 vehicles expected by 2025, South Africa will simultaneously function as a brand manufacturer, a domestic market player, and a regional exporter.
The African market will absorb 49.5 billion rand of South African automotive exports, with 85.1% flowing to members of the Southern African Development Community (SADC).
Chinese brands have entered the mainstream competition in South Africa.
Reuters, citing industry data, reported that from 2024 to 2025, the market share of Chinese brands in the South African passenger car market will rise from 11.2% to 16.8%, and the number of brands will increase from 8 to 15.
During the same period, China will account for 23.3% of South Africa’s light vehicle imports, second only to India.
Asset transfers are also occurring on the production side.
In January 2026, Nissan announced plans to sell the land, buildings, and related production assets of its Roslin plant to Chery South Africa by mid-year, subject to regulatory conditions.
If the transaction is completed, the Chinese automaker will directly take over South Africa’s established vehicle manufacturing plant and local supplier network.
Egypt: CKD and Policy Access Center
Data from the Egyptian Automotive Market Information Committee shows that total vehicle sales in 2025 reached 173,763 units, a year-on-year increase of 69.9%; CKD (Completely Knocked Down) sales reached 99,598 units, a year-on-year increase of 65%.
The total sales of 173,763 units and the 99,598 CKD sales in 2025 indicate that the recovery in Egyptian demand was mainly driven by local assembly.
This model integrates import permits, assembly qualifications, government orders, foreign exchange supply, and payment cycles into a single set of business conditions.
Egyptian assembly assets exhibit distinct characteristics of the national industrial system.
In April 2025, Stellar began local production of the Citroën C4X at the Arab American Vehicles Company plant, with an officially announced initial capacity of 6,000 units per year, which can be increased to 12,000 units per year.
Subsequently, the Egyptian Arab Industrialization Organization disclosed that the local manufacturing ratio for this model is 45%, with a planned annual production of approximately 7,000 units.
Figure 2. Asset Roles and Entry Conditions of the Three Major Automotive Clusters
