Trade wars and shifting vehicle demands are changing the landscape of car manufacturing. To adapt to the new world, Nissan signed a joint venture agreement this month to build a car assembly plant in Oran, Algeria, on the northern coast of Africa.
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According to Yahoo! Finance, Nissan signed on to build the plant as a joint venture with the Hasnaoui Group, with the second company owning a majority stake on the complex. The new factory will cost about $160 million with a planned capacity of about 63,500 vehicles every year. If everything goes to plan, the plant will open for production in the first half of 2020 with a staff of about 1,800.
Algeria is a large market for Nissan, but the company banned imported cars to try to protect its economy. It’s a member of OPEC, and lower oil and gas prices are driving it to encourage investments in its non-energy sector. Peyman Kargar, the senior vice president and chairman of Nissan’s operations in Africa, Middle East, and India, confirmed in a statement that the government had offered Nissan assistance to close the deal.
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Since Nissan is not the majority stakeholder in the project, the Hasnaoui Group will be in charge of employees and other functions. However, Nissan experts will train the staff there. As of right now, most of the cars seem destined to stay in Algeria, but Oran is right across the Mediterranean Sea from Spain. Kargar added in an interview that there is a possibility that cars built in Africa could be exported elsewhere. We’ll see what the global economy has in store for this new Nissan facility.
News Source: Yahoo! Finance
