A new assembly plant jointly built by China National Heavy Duty Truck Group and Ethiopia's N.A. Metal Industry & Engineering Co, started operation in Addis Ababa on Saturday.
Ethiopia's leading automaker invested about $9 million in the plant, while partner Sinotruk, one of China's largest heavy truck manufacturers, will provide its African partner with equipment and regular technological training. The new factory is expected to assemble 600 trucks annually.
"The African market, especially the Ethiopian market, plays a decisive role in Sinotruk's 'going global' strategy. We have long been committed to developing close ties with our partners and customers in the region," said Zhang Yuzong, head of the African office of Sinotruk.
"The collaboration between the two sides will offer more product selections to local customers, create more job opportunities for local workers and transfer solid skills to them," Zhang said. "It will also add a sharp competitive edge to Sinotruk and facilitate its further expansion in Ethiopia by saving transport costs, lowering import tariff."
Sinotruk said it currently occupies 85 percent market share in Ethiopia. During the first eight months, it sold over 5,000 vehicles there, up by 120 percent year-on-year.
"We are trying to further expand the Ethiopian market with our high-end products, such as the Sitrak series of trucks which is designed to compete with foreign top brands," Zhang said.
The main competitors in Africa are European truck makers such as Volvo Car Group and Germany's Mercedes-Benz. Many of these European trucks are secondhand, widely used in construction work and logistics services, Zhang added.
Nebiyou Assefa, chairman of N.A. Metal Industry & Engineering, said: "The goal of engaging with Sinotruk is to eventually produce most of the parts in Ethiopia then exporting the product to the Eastern Africa region."
Alemu Sime Feyisa, State Minister of Ethiopia Ministry of Industry, said Ethiopia should learn from China.
"It's very important that Ethiopian companies seek closer cooperation with Chinese firms that have experience and technical strength."
To date, Sinotruk has built a global market network in more than 100 countries and regions, including 43 African nations. Its exports to the African market increased to 16,000 vehicles in 2017 from 2,000 in 2010, thanks to demand from fast-growing markets like Angola, Niger, Ethiopia and South Africa.