Morocco Overtakes South Africa as Africa’s Automotive Powerhouse: Stellantis’ $1.4 Billion Boost

Morocco is asserting its attractiveness in the automotive sector. With a project to expand its industrial complex in Kénitra launched on July 16, Stellantis is giving a new impetus to the Moroccan automotive industry, notes the magazine Jeune Afrique. The manufacturer has invested $1.4 billion to triple its engine assembly capacity and strengthen its production of electric vehicles. The project aims to strengthen and integrate the Kénitra plant into Stellantis’ global value chains. Morocco is betting on this project to increase its production, going from 700,000 vehicles in 2024 to one million in 2025. The Moroccan authorities are also supporting the manufacturer through tax exemptions, free land, and training assistance.

According to experts, the expansion of the Kénitra industrial zone and the strengthening of Stellantis’ presence will transform the kingdom’s automotive industry, the diversity of Stellantis’ brands allowing Morocco to broaden the range of its sales on the local and global markets. This will allow Morocco to crush the growing competition from South Africa, long considered a reference in this sector on the continent, but whose industry is now threatened. South Africa has indeed remained in 2024 the largest automotive production and consumption center in Africa, but it is suffering from the competition of Chinese imports, whose sales have increased at the expense of seven local suppliers, such as Mercedes-Benz and BMW, the publication notes.

The new customs duties - 25% taxes, implemented on April 3, 2025 - imposed by the United States, South Africa’s second largest trading partner, are having a negative impact on the South African automotive industry. These taxes have put an end to BMW and Mercedes-Benz exports to the United States. The other Achilles’ heel: the transition to electric vehicles. South Africa, which risks losing 75% of its exports if it does not produce this type of vehicle, particularly due to the decision of the European Union and the United Kingdom to ban internal combustion engine cars from 2035.

Meanwhile, Morocco is progressing. Last year, its sales recorded a strong year-on-year growth of 52%. The kingdom’s ambition is to produce 100,000 electric cars per year by 2025, but also to increase the number of charging stations, from 1,000 to 3,500 by 2026. While Morocco is strongly integrated with Europe, South Africa is focusing on the African market, its second most important regional market.