Volkswagen opens Car assembly Plant in Kigali

DAILYNEWS UG |Kigali, Rwanda|

Volkswagen will open its first car assembly plant in Kigali’s Special Economic Zone on Wednesday 27th June 2018.

The German carmaker will beginning assembling the Hatchback Polo and Passat models. The Volkswagen Plant is the first such factory in Rwanda as Europe’s biggest carmaker expands its presence in the region.

Car ownership remains low in the nation of 12 million people with just over 200,000 private cars registered since 1997, according to the country’s tax collection body.

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Thomas Schafer, the Chief Executive Officer of Volkswagen South Africa (L) sign a memorandum of Understanding with former RDB Chief Executive Officer, Francis Gatare in December 2016 (File).

But Volkswagen, which already builds vehicles in nearby Kenya, hopes not just to sell vehicles but for them to also be used in an Uber-like car-sharing system where people will use their smartphones to book rides.

The German automaker said in January that it initially plans to build up to 5,000 cars per year, beginning with the Polo and Passat models.

The firm plans to start with about 150 vehicles for car pooling through an online platform that resembles the Uber car-sharing services.

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Mr. Schafer named a baby gorilla back in 2017 (Courtesy)

Another 150 vehicles will be produced for the ride hailing service.

According to Volkswagen South Africa CEO Thomas Schafer, the Kigali plant is expected to employ between 500 to 1,000 people.

The carmaker is seeking to expand its presence in East Africa after opening an assembly plant in Kenya in September 2016.

Image result for Volkswagen South Africa CEO Thomas Schafer,

Above: Clare Akamanzi RDB CEO with Volkswagen South Africa CEO Thomas Schafer

 

Michaela Rugwizangoga, CEO of Volkswagen Rwanda.

MD/CEO Michaella Rugwizangoga (above) was appointed in March Chief Executive  of the company’s operations in Rwanda. She is Rwandan with an engineering background.

This year, Volkswagen, announced that it will be producing three models; the Hatchback Polo, the Passat and possibly the Teramont, a large sports utility vehicle.

For a country which heavily relies on used cars, there is hope that the carmaker’s decision to assemble new cars in Rwanda will shift the trend.

Volkswagen impact on Rwandan car market

Statistics from the Rwanda Revenue Authority, as of 2017, indicate that between 7000 and 9000 cars are imported annually. Most of the cars are, however, used cars and do not have provisions, such as dealership servicing and guarantee.

Volkswagen looks to tap into the opportunity through the production of new cars and making provisions such as guarantees and servicing. The firm hopes that the locally made cars will serve to gradually phase out used imports.

The cars will also be made cheaper through sale of cars that have been used under the mobility solution for about two years.

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