Kia Motors began operations at its new vehicle assembly plant in Nigeria earlier this week, reports AllAfrica. The plant, United Vehicle Assembly Limited, is located in Lagos and has a production capacity of 25,000 units per annum. Jacky Hathiramani, the CEO of the new Nigerian subsidiary, and Sandeep Malhotra, the chief commercial officer at Kia Nigeria, sounded a positive note at the opening ceremony. The amount of investment in the new plant is unknown.
Significance: Kia first revealed its intention to establish a new vehicle assembly plant in Nigeria early last year. The company operates in Nigeria through local joint-venture partner Dana Motors Limited. Kia's decision to open the plant followed the enforcement of the new National Automotive Industry Development Plan (NAIDP) by the Nigerian government in 2013. This policy raised duties on the import of completely built-up (CBU) units in Nigeria sharply to 70%, from 20%. The increase was intended to discourage vehicle imports in the country and encourage local production. The automaker unveiled its made-in-Nigeria Rio, Cerato, and Optima cars at last year's Abuja International Motor Fair . The automaker said it was planning to produce a range of vehicles including sedans, sport utility vehicles, and pick-ups at the new plant in Nigeria, without revealing further details. The opening of an assembly plant in Nigeria is a positive development as the automaker can use it as a hub to supply other markets in the Middle East and Africa.
