An automobile communication specialist, Dr. Oscar Odiboh, has described the entry of Dangote Group into the automobile manufacturing sector in Nigeria as a step towards the birthing of truly Nigeria vehicle brand.
Dr. Odiboh, who spoke to Vanguard Motoring yesterday said: “I see Dangote’s investment as a step towards the birthing of a truly Nigerian car, brand of trucks and ultimately a truly Nigerian brand of vehicle. It is a pointer to the fact that it is only the private sector that can truly drive the auto industry.”
The move by Dangote is said to be a welcome development, commendable and is instructive for other wealthy Nigerians to come into the industry instead of waiting for foreign investors. For too long, the sector has been dominated by foreign investors.
The foremost entrepreneur, Aliko Dangote, has taken advantage of the ongoing scarcity of Foreign Exchange (FOREX) in Nigeria to establish multi-million dollar truck assembly plant in Lagos State. The project is expected to generate 3,000 jobs.
According to Dangote, the plant will be churning out heavy duty trucks on which his conglomerate, the Dangote Group spends huge amount on its importation to distribute it’s products both locally and cross African countries.
Explaining further, the Group said: “There will be room for the expansion of the project in years to come as it meets the national truck demand, it would explore exportation to neighboring countries to generate foreign exchange for the nation”.
Under the arrangement, Dangote is partnering a leading Chinese Company, National Heavy Duty Truck Group Company Limited, SINOTRUCK to produce several thousand of trucks used mainly for haulage business from its newly promoted assembly plant at Ikeja, Lagos.
The Group explained that the decision to go into the truck assembly plant project was informed by the need to conserve forex in view of the current economic recession that is facing the country. The deal which worth $100 million which is expected to have an assembly plant that will produce 10,000 trucks per year was signed in May 2014 in China, making it the eighth of Shandong, China (SINOTRUK), to be built abroad.
According to the deal agreement, the plant is 60% owned by Dangote Group, trading under Dangote Industries Limited, leaving SINOTRUK with the remaining 40% equity stake. Consequently, Dangote Agro Sacks Limited, which occupied the Oba-Akran Ogba premises of the former Nigerian Textile Mills, until recently, has been relocated closer to the group’s major operational hubs, particularly the cement plants in Obajana, Kogi State and Ibeshe, Ogun State.
The assembly plant plant is expected to generate employment for an estimated 3,000 workers when fully operational. Nigeria remains one of the most important markets for SINOTRUK, with Dangote Group operates the largest truck fleet in Africa with over 10, 000 trucks using them for the distribution of its products, like cement, sugar, flour and pasta, among others, even in its plants across the continent. Chief Corporate Communication Officer of Dangote Group, Mr. Anthony Chiejina, confirmed the project has taken off adding that when fully operational, the nation would be spared huge amount of forex spent in the importation of the heavy duty vehicles.
Source: Vanguard Motoring