Ghana will cement its position as West African’s automotive production hub in the coming years, according to Fitch Solutions, research arm of ratings agency Fitch.
The report noted the expected dominance of the nation in the automobile space in West African is due to the comprehensive policy by the government.
“We believe developments in Ghana’s metals sector (steel and aluminium in particular) raises the potential for the country’s nascent autos industry to move up the value chain.”
In August this year, President Akufo-Addo laid the foundation stone of an aluminium metal casting factory and CNC machine tooling centre, which creates opportunities for automotive component manufacturing in the country.
It added: “aluminium products such as aluminium alloy wheels, transmission housings and certain engine components such as piston rods and cylinder heads could thus be manufactured locally.”
“The trend towards light weighting (due to aluminium’s weight reduction properties being beneficial for fuel efficiency) in the autos industry raises opportunities for more aluminium content in vehicles especially as Ghana’s automotive industry develops further”, it noted.
Volkswagen and China’s state-owned, Sinotruck, have begun the assembly of vehicles in the country, while Toyota is still in the process of completing its vehicle assembly plant and Nissan is set to begin assembly soon.
The UK based research firm said ‘we believe this creates opportunities for these automakers to utilise domestic aluminium and steel autos related products, thus enabling the automotive industry to potentially utilise locally sourced metals.”
Nigeria which is ECOWAS automobile sales leader in volume terms, according to the report, has not captured the appeal of automakers due to policy uncertainty and a tough operating environment.
Fitch said aluminium products such as aluminium alloy wheels, transmission housings and certain engine components such as piston rods and cylinder heads could thus be manufactured locally.
IFC, Rider Iron signs steel production agreement
The International Finance Corporation signed a loan agreement with Rider Iron and Steel Limited for the expansion of a steel production plant which is set to increase the nation’s steel output by 75 percent by next month. This further raises the opportunity for local component manufacturing in the country.
Intermediary auto-related products such as body structures, panels, trunk closures and engine blocks, it said, could therefore be manufactured locally.
In East Africa, Kenya will most likely according to the report sustain dominance, while South Africa maintains its position to supply the Southern African region.
Latest Stories
-
Alan Kyerematen is the situational leader Ghana needs at this critical time – Boniface Siddique
4 mins -
Speaker to address media on recent developments in Parliament, other issues on Wednesday
4 mins -
#Eleection2024: It’s a collective responsibility to maintain peace – Asogli Queen
8 mins -
Bawku conflict claims 61-year-old man, raising death toll to 22
14 mins -
Ghana’s education system stifles critical thinking, innovation – Sam Jonah
19 mins -
“Pay us our royalties” – Celestine Donkor’s manager to Boomplay
26 mins -
Ghana’s overlooked cocoa farmers: The key to a fair and sustainable cocoa industry
50 mins -
Napo urges Seikwa to reject NDC, accuses Asiedu Nketiah of rejecting his hometown
54 mins -
MTN Foundation empowers Volta Region entrepreneurs to drive Ghana’s economic transformation
57 mins -
Sam Jonah criticises reliance on past questions, calls for education reform
1 hour -
Abronye lauds Napo’s impact in Bono Region
1 hour -
Election 2024: Confusion rocks GFP as 2 factions send contradictory letters to EC
2 hours -
NDC Chairman asks NPP supporters to vote out governing party to allow internal restructuring
2 hours -
More youth to enjoy digital skills training – Dr Bawumia
2 hours -
Sam Jonah calls for military-based National Service in Ghana
2 hours