Tanzanian automotive industry gets major boost

Dar es Salaam. Tanzanian company GF Automobile, in collaboration with India’s Mahindra & Mahindra, will launch a local assembling facility for cars in Tanzania in the next six months.

The partnership between GF Automobile and Mahindra & Mahindra comes just one month after President Samia Suluhu Hassan visited India, where among other issues, the Mumbai-based Indian firm (Mahindra & Mahindra) agreed to set up a tractor assembly facility in Tanzania.

And yesterday it was revealed that during the trip, the President also asked Indian investors from various sectors to take advantage of the opportunities available in Tanzania.

The GF Automobile and Mahindra & Mahindra partnership will invest Sh10 billion in setting up the local car assembling factory.

The samples of cars whose local assembly will start within six months were exhibited in Dar es Salaam yesterday during a brief event that was witnessed by the Minister of State in the President’s Office (Planning and Investment), Prof Kitila Mkumbo, and the Tanzania Investment Centre (TIC) Executive Director, Mr Gilead Teri.

The director of GF Group, which owns GF Automobile, Mr Imran Karmali, said they are set to start the project in six months and that the amount to be invested will be sourced jointly between the two partners.

He said the assembling plant will lower car costs and enable Tanzanians to afford brand new vehicles.

“These cars will also be new (0 kilometres). I suggest the governments should attract these investments by discouraging the importation of used cars,” said Mr Karmali, whose GF Tracks and Equipment Company assembles heavy trucks.

He added that they will assemble four-seater cars and pickups, among other products from Mahindra & Mahindra and other brands that he did not disclose. Assembling of passenger vehicles would also start in the near future.

Speaking at event, Prof Mkumbo said that on their trip to India, they met with many investors, but Mahindra & Mahindra promised to be the first to bring its investments to Tanzania.

“This investment means job creation, taxes for the government, and boosting individual Tanzanian economies,” said the minister.

He said that the investment goes in line with the government’s goals in attracting investors in cars in the country, especially those who assemble electric vehicles, saying that the country has a lot of resources, such as lithium minerals, which are capable of making electric batteries, hence reducing the cost of production.

“The government will also review its policy on importing cars. Currently, you are allowed to import any car, even if it has been used for 100 years, with higher taxes being charged,” Prof Mkumbo said.

For his part, Mr Teri said the company’s arrival reflects the increase in investment witnessed between July and September this year, where at least S2.51 trillion has been invested in various sectors, which is double that of the preceding year.

He called for local investors to participate in economic reforms by using incentives provided by the government so that they could invest more easily and form partnerships.

“Tanzanians with schools, plots, and buildings who are looking for partners to co-invest with, I encourage them to reveal them. When TIC goes abroad to encourage investment, we like to see investors who are not investing 100 percent themselves. We would like to see what happened with Gf Automobile and Mahindra happen to many Tanzanians,” said Mr Teri.