Caption: Industry and Commerce Minister Mike Bimha and Chinese Ambassador to Zimbabwe Huang Ping prepare to cut the ribbon at the launch of the first unit of BAIC Pick-up assembled at Willowvale Motor Industries in Harare on Monday last week.
HARARE— Willowvale Motor Industries (WMI), which had been shut for the last five years, officially resumed operations on Monday, March 27 2017, following a joint venture with a Chinese firm to assemble locally a new range of pick-up trucks from semi-knocked down kits.
The deal will see WMI assembling 3 000 units in three years, which will create 5 000 jobs and generate millions in taxes, with US$1,3 million in Value Added Tax expected to be generated this year alone. This is in fulfillment of mega deals President Mugabe signed with his Chinese counterpart President Xi Jinping in August 2014.
The partnership has resulted in the formation of Beiqi Zimbabwe, a joint venture between China’s fifth largest car manufacturer, the Beijing Automobile International Corporation (BAIC), WMI and Astol Motors. Pick-up trucks that will be put together at WMI are called BAIC Great Tiger.
Beiqi Zimbabwe is responsible for procuring the semi-knocked-down kits from BAIC in China, while WMI will assemble the vehicles on a contract basis and Astol Motors, together with Amtec, will sell the vehicles and offer after service support. WMI’s assembly plant had been under care and maintenance for the last five years and has now assumed the new role of a multi-contract assembler.
From the deal with BAIC, total sales volume is expected to be about 490 units this year, before rising to 940 units in 2018. Of the 3 000 units, which will comprise pick-ups, sedans and SUVs (to be launched later this year) 500 units will be exported to other Sadc countries.
Industry and Commerce Minister Mike Bimha, who officially launched the deal, said it was a clear indication of the excellent and cordial relations between Zimbabwe and China, and the kind of investment that the country was seeking. “The investment has come at the most opportune time given that Willowvale Motor Industries had suspended production since September 2012,” he said.
“Today, the factory has been refurbished to some extent, but we hope our Chinese partners will transform it further into a state-of-the-art facility given the great strides they have made in technology advancement.
“I wish to applaud BAIC International Group for the milestone it has achieved so far which is evidenced by the semi-knocked down (SKD) kits that have been brought into the country to kick-start production. “We would like to see a situation where BEIQI Zimbabwe moves from SKD production to completely-knocked down (CKD) production and possibly venture into local manufacturing of vehicle components. “It is these kinds of partnerships that obtain across jurisdictions that Zimbabwe as a country is looking for. This enables the country not only to substitute imports, but generate the much needed foreign currency through exports and create employment.”
Minister Bimha called on banks to support the initiative by establishing retail financing structures at favourable terms, so as to stimulate demand and ensure growth of the sector. He said Government was finalising the Motor Industry Development Policy Framework expected to increase capacity utilisation of car assemblers from levels of below 10 percent to the year 2000 levels of around 70 percent.
BAIC’s vice president Wei Huacheng said they were committed to assist in the growth of the local economy through their assistance to the motor industry.
“Beiqi considers Zimbabwe and SADC as a whole market, we are going to start to export assembled vehicles in Zimbabwe to SADC countries from 2018,” he said. “The main market share in Zimbabwe is pick-ups at 68 percent, cars 12 percent and SUVs 15 percent.
“We will focus on the pick-up market with our diesel engine double cab and single cab, 4×2 and 4×4.” Huacheng said 60 sets knocked down kits and $15 000 worth of spare parts were already ware housed in the country, while jigs, tools and facilities were ready and workers have been trained. Chinese
Ambassador to Zimbabwe Huang Ping said the partnership will further deepen the co-operation between Zimbabwe and China, which has so far fostered a number of projects.
“I believe that the cooperation with BAIC Group will inject new strength into Willowvale Motor Industries plant and bring it into new successes,” he said. “Besides, the project is all the more remarkable given the sluggish economic situation at present since it shows that Chinese companies have cast a vote of confidence in the development prospects of Zimbabwe.
“I believe the Beiqi Zimbabwe project will cement China-Zimbabwe cooperation in the automotive industry and drive its development and the economy by bringing products, capital, technology, standards, services and management concept, as well as increasing Government tax revenue and employment opportunities,” he said.
Willowvale Mazda Motor Industries, which is owned by the Industrial Development Corporation, is one of two vehicle assemblers in the country. At its peak in 1997, it was producing 18 000 vehicles per year before production plunged to below 4 000 in 2012 due to a myriad of challenges.