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Opportunities in the Automotive Industry in Egypt 1.

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Presentation on theme: "Opportunities in the Automotive Industry in Egypt 1."— Presentation transcript:

1 Opportunities in the Automotive Industry in Egypt 1

2 Overview of Vehicle Production Components Industry Automotive Strategy “1M2020” What Egypt has to Offer

3 Vehicle Assemblers in Egypt Egyptian Companies Private & Public Joint Ventures 100% Foreign Ownership Gorica Egypt Automotive Eng. Co. Passenger Cars Commercial Vehicles

4 Rapid Growth Vehicle Registrations In thousands of Vehicles Source: AMIC Reports 68% 42% 32% % -21% 21% Projected

5 1.US$ 900 million serving the OE local assembly and the aftermarket for 4.1 million vehicles Annual growth rate is 14.8% 2. US$400 million Exports Over 90% of exports are destined to Europe (OEM aftermarket) The Egyptian automotive components production is estimated at US$ 1.3 billion: Auto Components Industry in Egypt Local 70%

6 Major Components & Customers Electrical Wiring Harnesses Tyres Brake Parts

7 Recent Developments Egypt invested US$ 100 million in a wholly owned facility to produce Sunny & Pickup trucks Egypt was the first country to assemble the S-class outside Germany Sabanci with Lasheen invested more than US$ 30 million to build 1000 coaches per annum US$ 50 million to build 1,500 coaches Pirelli invested US$ 65 million to increase Truck Tyre capacity by 50% GM Egypt added state-of-the-art paint line with an investment of US$32 million. Yr 2007 to Yr 2009 CAPEX over US$ 75 million Footprint Optimization Manufacture & export wiring harnesses from Port Said Toyota announced that it will start assembling the Fortuner SUV in Egypt by early 2012 Software engineering. Started 50 engineers. Now 250

8 Economic Reforms Growth in GDP Turkey’ GDP per Capita is $5,000 and its car penetration is 70 Untapped Potential !!

9 “1M2020” Vision 2020: Stimulate expansion of automotive vehicle production to 1.0 million vehicles per annum by Strategy based on 4 Key pillars: Adherence to International (UN ECE) homologation Standards Capitalising on the portfolio of Free Trade Agreements Encouraging local value addition through Automotive Incentive Scheme Support Firm level competitiveness improvement programmes

10  Competitive wages and salaries. What We Offer Labour HOURLY Wages*: Low skill/ manual work € 0.60 Semi-skilled € 0.75 Skilled € 1.00 Engineer MONTHLY Salary*: Junior Engineer € 350 Senior Engineer € 800 * Based on a survey conducted by EAFA/IDA on 20 auto component manufacturing companies.  Competitive cost of other factors of production. Under good management and with proper training, the work force exhibits adherence to a good work ethic, very low absenteeism and commitment to achieving agreed KPIs.

11 What We Offer Strong Government support: o Training o Development of companies’ quality systems and competitiveness o Export Tax Rebate Regional Trade Agreements e.g. COMESA, AFTA, Aghadir, Mercosur Exemption from Turkish and European Union customs duties for Egyptian exports

12 What We Offer Proximity to a big market in Europe OEM: annual Vehicle Production > 20 million vehicles Aftermarket: replacement parts for > 250 million vehicles values at Euro 44 billion per annum 10 days shipping to UK, Scandinavia 6 days to Italy, Spain, France Low cost of shipping to Europe Using the new 2010 RORO line, transit time is reduced to 5.5 days to UK and 4.5 days to France


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