New VW factory considered for Africa

Volkswagen is considering a new factory in Egypt in an attempt to expand its presence in Africa.

Speaking to Bloomberg, Volkswagen Group Africa MD Martina Biene confirmed that the company is seriously investigating in this opportunity.

“We are very interested in Egypt as a production hub and hopefully we can announce a business case anytime soon,” said Biene.

Egypt would be a promising location for a new factory, as it can serve both the Middle East and African markets.

The new factory would not be the first VW production facility on the continent, however, as the German brand already has an African manufacturing presence.

Alongside its assembly facilities in Ghana, Rwanda, and Kenya, VW has a fully-fledged factory in South Africa.

VW’s South African factory

The factory in Kariega manufactures the fan-favourite Polo and Polo Vivo hatchbacks, although the site had to temporarily pause production of these vehicles recently while performing upgrades to the facility.

These upgrades included improvements to the Body Shop, Paint Shop, and Final Assembly, with a key focus on enabling the Kariega factory to produce three different cars simultaneously.

This was important because Volkswagen will be introducing a third assembly line, which will be used to produce a new crossover that is smaller and cheaper than the T-Cross.

While Volkswagen is known as the Tera in other markets, it is only referred to as the “A0 SUV” in South Africa so far – as it will be receiving a different name locally.

It is focused on reclaiming the entry-level segment from Chinese and Indian brands that have been undercutting the market in recent years.

It has already gone on sale in Brazil, with dimensions similar to the T-Cross except for a shorter height and a smaller 350-litre boot.

It also differs from the T-Cross with its 1.0-litre petrol engine that generates a lower 56kW and 92Nm.

While VW has not provided pricing yet in South Africa, it starts at the equivalent of R315,000 in Brazil – whereas the T-Cross currently retails from R399,900.