Fitch Solutions predicts Ghana to emerge as an automotive production hub in West Africa in the years to come. The ratings agency report suggests that comprehensive policy by the Ghana Government could be a potential factor for the nation to dominate West African automobile space in the future.
“We believe developments in Ghana’s metals sector (steel and aluminium in particular) raises the potential for the country’s nascent autos industry to move up the value chain,” said Fitch Solutions.
In August 2020, President Akufo-Addo laid the foundation stone of aluminium casting factory and CNC machine tooling centre, a step towards creating opportunities for automotive component manufacturing in the country.
Fitch Solutions added, “Aluminium products such as aluminium alloy wheels, transmission housings and certain engine components such as piston rods and cylinder heads could thus be manufactured locally.”
“The trend towards light weighting (due to aluminium’s weight reduction properties being beneficial for fuel efficiency) in the autos industry raises opportunities for more aluminium content in vehicles especially as Ghana’s automotive industry develops further”, the agency noted.
Volkswagen and Sinotruck have already begun the assembly of vehicles in Ghana, while Toyota is about to complete its vehicle assembly plant. Nissan is also set to begin assembly soon.
The UK based research firm said, “We believe this creates opportunities for these automakers to utilise domestic aluminium and steel autos related products, thus enabling thecto potentially utilise locally sourced metals.”
Meawhile, the International Finance Corporation signed a loan agreement with Rider Iron and Steel Limited for the expansion of a steel production plant, which will increase Ghana’s steel output by 75 per cent from November. This will further raise the opportunity for local component manufacturing in the country.
Note to readers: AlCircle brings two-day event for aluminium industry players. We look forward to meeting you virtually at “Global Aluminium Expo 2020”on October 6-7, 2020. For registration, visit www.alcircleevents.com
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