After nearly 16 months of the shutdown, the car assembly plant of the French manufacturer Renault in Algeria is operational again.
Production resumed after customs clearance of part of the assembly kits since last April that was overdue at the port of Oran, we learned, this Sunday, May 23, from Renault Algeria officials.
“The factory gradually resumed its activity a few days ago. The recovery is temporary,” they told TSA. “It takes time for the plant to reach its nominal production capacity. The factory has 280 workers out of more than 1,200 who were employed before its shutdown,” they said. “The resumption of activity is temporary,” they insist.
In order to get the plant back up and running, Renault has been working since April to check the machines, retrain the staff and prepare the technical and sales teams for the assembly and sale of the cars. “We have 56 showrooms across Algeria. No after-sales service repair space has been closed due to the crisis,” they say.
Officials Renault Algeria would like to clarify three things that are important: the recovery of the factory based in Oued Tlélat “is not final. It is temporary”. The number of cars that will be assembled during this recovery is 4,600 units. “To produce these cars, it takes between 3 and 4 months. Because the plant has not yet reached its nominal capacity. Before such production was done in a month, but the factory employed 1,200 people, this is no longer the case”, explain the same officials.
For the final takeover of the plant, the officials of Renault Algeria give no details. Everything will depend on the new Algerian regulations on the automotive industry.
The second element is linked to the price of the cars that will be assembled in Oued Tlelat this summer. “Renault paid the VAT and customs duties on the customs clearance kits. The prices of the vehicles will be higher than those leaving the factory before the end of imports of SKD / CKD kits, that is to say in 2019”, they explain.
“We will naturally pass on the VAT and customs duties on the price of the assembled vehicle”, they specify. These taxes did not exist before the shutdown of the plant. Parts intended for vehicles assembled in Algeria were not subject to VAT and customs duties.
In addition to VAT and customs taxes, the price of vehicles will be impacted by the parity of the dinar against the euro and the dollar. The national currency lost 20% of its value against the euro in 2020, and more than 10% against the greenback.
The customer might indeed be surprised to discover new prices for more expensive “made in Algeria” Renault cars. No indication of the new prices was given. “For the moment, we have not stopped the prices,” they add.
The third and last element concerns the marketing of assembled vehicles, with the kits cleared last April. “We will start by satisfying the requests already pending, which were at our level before the shutdown of production. These are the priority customers. We have strong demand from businesses,” they indicate.
The Renault Algeria factory was put into service in 2014. In January 2020, it closed its doors, following the government’s decision to ban imports of SKD/CKD kits and to remove the tax benefits granted to installed car manufacturers. in Algeria.
