According to the new analysis that was done by IHS automotive which is the number one source of information, there is a significant growth in Africa and more opportunities are opening up. Due to this growth, the automotive industry considers Africa to as being the “Final Automotive Frontier” for the industry.
The demand on the light vehicles is on the lead. Gross Vehicle Weight (GVW) which represents vehicles that goes up to 6 tones has stood at 1.6 million units since the year 2012. By the year 2027, IHS projects that the growth of light vehicles will be more than 2.7 million units by 2027. However, the demand for both the medium and heavy buses and trucks is projected to double between the year 2012 and 2027.
Notably, HIS says that regional integration, Economic development, foreign direct investment and investment in infrastructure are the factors that are contributing to the growth. IHS is responsible for providing expertise, predictive during automotive production to the sales and marketing. By offering this kind of support, automotive industries are able to make use of the available market to the maximum.
Some of the governments in Africa such as North Africa and South Africa among others are developing their own automotive industries so as to create employment and as well to achieve economic growth. Also, there are regulations on the vehicles that are imported in African countries. This helps in ensuring that vehicles that fail both safety and standards tests don’t find their way in these countries. Due to these regulations, better opportunities will be available for the sales of vehicles in these regions.
According to Walt Madeira who is the senior analyst for the HIS automotive, more African countries will witness a double growth in the demand for lightweight vehicles by 2027. Walt gives an example of Nigeria whose double-digit growth by the year 2027 is projected to be about 260,000 units.
According to the analysis conducted by the HIS automotive, South Africa provided the largest market for vehicles in the whole of Africa and this is not expected to change anytime soon. Algeria comes second after South Africa. However, it is projected that the market share South Africa will slowly decrease from 40% to 32% by the year 2027. This is because Nigeria and Angola market share is growing very fast. This was confirmed by Walt, the ISH senior analyst.
When it comes to medium and heavy buses and trucks, the market growth is very different according to IHS analysis. Kenya is ranked among the leaders of markets for the newly produced vehicles. According to Andrej Divis who is the global director for commercial vehicle forecasting at IHS, Kenya is expected to lead in market growth for medium and heavy trucks. That means Kenya will be among the top countries that provide a bigger market for vehicles. These countries are South Africa, Algeria and then Kenya.