Egypt’s biggest car assembler GB Auto (AUTO.CA) is currently studying expansion opportunities in Algeria to offset declining sales in Iraq and to liquidate its stock in Libya, Chief of Investment Menatalla Sadek said.
Sadek explained that the company is looking into the nature of commercial agencies that suit the Algerian market, and how the market differs in terms of customers’ demands.
GB Auto currently sells Chinese models, including Geely, in the Algerian market, as well as Grandstone, Lassa, and Rotalla tires, according to Sadek.
The company announced in 2013 that it would enter the Algerian market by signing an alliance with the Algerian group, Rahmouni. At the time, GB Auto said it targets a market share of 4-5%.
GB Auto’s consumption of cars in Algeria is three times higher than the Egyptian market, even though the population only stands at 37 million.
Sadek said the Iraqi market is ambiguous, and its developments are often hard to observe, especially with regards to the security situation, which makes it difficult to draw clear strategies for future business and has caused the company to incur major losses in the last year.
Sadek added that GB Auto has yet to settle its US dollar commitments. These sums, she added, accumulated due to banks’ delay in providing the company’s US dollar requirements after opening letters of credit to finance its imports.
An investment report issued by the company revealed that these sums register $85.42m. The company however repaid a large sum of these dues, bringing the figure down to $47.1m at the end of February.
Source: Daily News Egypt