Foton revs up for Kenya truck assembly

Beijing-based company partners with AVA in strategic move to reduce costs, boost quality

Riding on the Road and Belt Initiative, which encourages Chinese companies to invest in countries and regions along the Belt and Road routes, Chinese motor vehicle manufacturer Foton Motor Group is betting big on the African market.

Africa is a huge market for motor vehicles, says Apple Sun, general manager of the company's Kenyan subsidiary, Foton Motor Kenya Ltd.

As a Belt and Road participant, Beijing-based Foton Motors "has set a long-term strategic plan in Africa. We are committed to pushing globalization and localization," he says.

The company is specifically optimistic about growing its market share in Kenya, the biggest economy in East Africa. Toward that end, Foton Motor Kenya signed an agreement with Associated Vehicle Assemblers, a Kenya-based automotive and commercial vehicle manufacturer, for local assembly of its trucks.

On Jan 24, Foton unveiled its first locally assembled truck at AVA's plant in Mombasa, the second-biggest city in Kenya.

Sun says his company, by partnering with AVA, aims to reduce costs as well as ensure the quality and craftsmanship of the assembled products.

"Foton's partnership with AVA is strategic. AVA is one of the three largest knock-down assembly plants in Kenya and is also assembling for some of the internationally renowned brands such as Toyota and Scania," he says.

Sun says the target is to assemble between 300 and 500 units per year, with the figure projected to grow to 3,000 to 4,000 in the next five years. Within the same period, the company expects to grow its revenues to $19.5 million from the current $2 million.

"Foton Motor is committed to providing locals with high-value products, spare parts and after-sales service. This is in addition to creating job opportunities and contributing to the development of the local economy," he says.

To ensure that its products meet the desired standards, Sun says Foton has sent a group of technical experts to AVA and shipped some equipment from China to optimize and upgrade AVA's assembly line.

Sun says that although many international companies are assembling similar models of vehicles, Foton is committed to offering the best quality as well as meeting all of its customers' needs.

For now, Foton's heavy-duty trucks will be assembled at AVA, with plans to extend to other vehicles such as light trucks and sport utility vehicles in the future.

Moses Obiero, the production manager at AVA, says the company is happy to have Foton in its long list of customers.

"I thank the Foton engineers who supported us greatly to ensure that the assembling of the first truck was successful," he says.

Obiero says the reduction of import duty by the Kenyan government from 25 percent to 10 percent has greatly encouraged local vehicle assemblers. "The government should put policies and measures in place to facilitate growth of the sector, like ensuring that very old cars are not allowed on the roads," he says.

Foton Africa has appointed four dealers in the Kenyan market: Roton Africa in Mombasa, Pewin Motors in Nairobi, Kylin Motors in Kisumu and Lochab Brothers in Nakuru.

Zhang Zhongduan, the CEO of Roton Africa, says assembly of Foton trucks in Kenya will increase competitiveness of the brand in the market. "Continuous delivery of new Foton trucks will also give customers more choices," he says.

The entry of Foton into the Kenyan market is expected to challenge the more expensive European makes like Scania, Mercedes, Volvo and Renault.

Founded in 1996, Foton Motor Group (formerly known as Beiqi Foton Motor Co) offers commercial vehicles including light-, medium- and heavy-duty trucks, vans, pickups, buses and construction machinery.

Foton has established more than 70 representative offices and over 1,000 overseas distributors worldwide.

edithmutethya@chinadaily.com.cn

(China Daily Africa Weekly 02/02/2018 page24)