Local automobile company, Kantanka is in need of a capital injection of 100 million dollars for expansion works.
General Manager of the company, Francis Kojo Kudjordzi, disclosed to Joy Business the company is also exploring “possible partnerships” in the coming months.
“We are expanding in the months ahead. For now, we need an investment capital of about $100 million. This is crucial at the moment when demand is fast increasing and our market share is expanding,” he revealed.
Already, the automobile company has remodeled its market targets as it is now producing small economic vehicles on demand.
These cars come in the range of a manual gearbox as well as an electronic automatic gearbox powered by lithium batteries.
“With just ¢45,000, you can get one of these small cars that come in manual and electronically powered automatic gearboxes. We have assembled them for intercity transportation and not countryside travels,” he added.
Already, some automobile giants have established assembly plants in the country after the government announced the automobile bill that sets the centre stage for the country’s niche automotive industry.
Events started taking shape in August 2018 when German Chancellor, Angela Markel, paid an iconic visit to Ghana for a partnership to have German automobile giant – VW, establish a car assembly plant in Ghana.
“We are very interested in investing in Ghana. I’m happy to say we are signing a MoU with the government of Ghana with our automobile giant, VW taking the fore.”
So far, VW has outdoored a collection of its newly assembled cars in Ghana with the price pegged at ¢60,000 – that’s for a brand new VW vehicle. According to the Trade Minister, Alan Kyerenmanteng the compilation of an automobile bill is a game-changer for Ghana and the rest of West Africa.
“What is happening means a lot for the economy. It is going to reduce our import bill of $10 billion per annum. Our 30 leading imports constitute a chunk of this amount. Out of this thirty, the top three is led by the importation of vehicles. The establishment of automobile industry is the best solution”
Never get it wrong, VW is just one of many other automobile giants racing to establish car assembly plants in the country. Suzuki, CFAO, and Toyota are among other competitors.
“We find Ghana as the right place to invest in the automobile industry. We came to know from Toyota that Ghana has introduced a new automotive policy. We are highly interested in participating in this initiative General Manager for Middle East and Africa of Suzuki Motor,” Koyote Suzuki revealed.
With 30 per cent shares in Ghana’s automobile space, Toyota is up for some competition as it focuses on a local assembly point in the country. Andrew Lamptey is head of sales operations of Toyota Ghana.
“ It is our responsibility to ensure that every Ghanaian who wants to own a vehicle gets one. We are committed to packages that will make the vehicle affordable and easily accessible to all Ghanaians,” he revealed.
Already, local dealers in second hand vehicles feel threatened by the government’s ambitious move for an automobile industry.
Eddy Kusi is a second hand car dealer. He minced no words jabbing the government for going in for international giants.
“ If you are a government bringing in an assembler – we have these big car companies coming in – allowing them to operate with free duty for three years. What are we gaining as a country? The automobile people in Ghana will be kicked out of business. It makes no sense,” Eddy Kusi lamented.
President Akufo Addo has been explaining the reason for this move. To him, opening the space for healthy competition and granting Ghanaians the option to purchase affordable brand new cars are all that matters.
“I’m expectant that the brands being assembled in Ghana will not only be affordable but also of the highest quality. The government will always support in diverse ways to ensure the sustainability and profitability of these brands,” the president expressed.
Meanwhile, the Automobile Dealers Union of Ghana is threatening a nationwide demonstration against the government’s move.
With Ghana’s second dealers numbering in their hundreds, disruptions in their supply could affect job numbers.
Trade Minister, Alan Kyerementeng at the unveiling of the cars from VW said jobs are rather going to be created and not lost.
“There’s no doubt that this effort of government together with private will help us not just earn foreign exchange but also create millions of jobs across the automobile value chain,” he stated.
We engaged the MD for VW Ghana, Jeffery Oppong Peprah who maintained the presence of automobile giants in Ghana will in no way spark a wave of job losses for second hand car dealers.
According to him, “second-hand operators won’t lose their jobs. We are going to transfer technology and knowledge”.
If successful and sustained, Ghana’s niche automobile industry can sprint the country into the leagues of nations locally producing vehicles for not just local but also international consumption – a feat that will open up a new contribution to GDP in the long term.