The car dealer KIV Group and Chinese automaker “Foton” specializes in the manufacture of heavy vehicles have inked, on Thursday, a contract in Algiers, for the creation of a joint enterprise Foton Motors Algeria, for installation of an assembly plant and manufacturing trucks in the province of Annaba (east Algeria), APS reported.
The document was initialed by KIV Group General Manager, Ahcene Khodja, and Vice President of China’s Foton Group, Yang Guotao, in the presence of officials from the Ministry of Industry and Mines.
The project, which will be carried out according to the rule 51-49% governing foreign investment in Algeria, is costing 50 million dollars, 50% of which will be provided by Foton Motors Algeria’s own funds, while the rest will be covered by banks, Khodja told the press.
Covering an area of 160,000 m2, the plant will create 300 direct jobs, during the first year to reach 1,000 positions gradually after three years of operation, “Said KIV Group Chief Executive Officer, who has been Foton’s exclusive representative in Algeria for more than 15 years.
The first phase of production will involve manufacture of the three best-selling Foton truck models on the local market, namely 2.5 ton (t), 3.5 t and 6 t trucks with a production capacity of 5,000 units / year, during the first year of operation, to reach between 20,000 and 30,000 units / year, within 4 to 5 years, knowing that the first Foton truck will come out of the factory in March 2018”, he explained.
As for the integration rate, it estimated that it would be 10% in the first year of operation, and it will gradually increase to 40% by 2022.
According to Khodja, the manufacturing process will take place in two phases: the first one, going for the period 2018-2020, will consist of producing the SKD (assembly) models and the second, beyond 2020, will Production in CKD (the paint chain and the manufacture of various parts and accessories will be locally manufactured).
For his part, the vice president of Foton Group said the project was part of the Algerian-Chinese partnership framework and that his group would ensure a transfer “reliable” and “fast” technology, while ensuring formation of Algerian engineers.