Chinese automakers shift to African production

Chinese automakers are increasingly shifting from exporting vehicles to building them in Africa, betting on rapid urbanization, a growing middle class, and supportive government policies to make the continent one of the industry's last major growth markets. This strategy responds to slowing domestic demand and rising trade barriers in Europe and North America. In July, Chery, China's largest auto exporter, acquired Nissan's former Rosslyn plant near Pretoria, South Africa, where it plans to produce plug-in hybrids, battery-electric vehicles, and models under its Jetour brand. Other Chinese automakers, including BAIC Group (BAIC) and Great Wall Motor, already have localized assembly or manufacturing capacity in South Africa. Analysts highlight South Africa, Morocco, Kenya, Ethiopia, and Ghana as best positioned to attract Chinese EV investment, with Morocco benefiting from proximity to Europe and Zimbabwe's lithium reserves supporting battery supply chains. Local manufacturing could lower vehicle prices by avoiding import duties and stimulate investment in charging infrastructure and battery production. Governments are aligning policies: Ethiopia has banned fossil-fuel vehicle imports, while South Africa offers production incentives. The African Union's Green Minerals Strategy aims to increase domestic processing of critical minerals. Chinese automakers like BYD Company, GAC, and XPeng are also expanding globally through technology licensing and local manufacturing, with BYD Company licensing its e-platform to Toyota and blade battery technology to Hyundai Motor Company, and XPeng supplying autonomous driving systems to Volkswagen. This shift is expected to reshape Africa's automotive industry, creating jobs and accelerating EV adoption, though weak infrastructure and policy uncertainty remain obstacles.