Stellantis NV will invest R3 billion to develop a new vehicle manufacturing facility in South Africa with the country’s Industrial Development Corp. and the Department of Trade, Industry and Competition.
The owner of brands such as Alfa Romeo, Chrysler and Jeep first signed a memorandum of understanding with South Africa’s government in March.
The project was finalised on Wednesday at a meeting attended by Stellantis Middle East and Africa Chief Operating Officer Samir Cherfan, Trade and Industry Minister Ebrahim Patel and IDC officials, the trade department said in a statement.
The factory will be built in a special economic zone near Ngqura and Port Elizabeth ports in the Eastern Cape province, where Mercedes-Benz, Volkswagen AG, Ford Motor Co. have plants.
The department said the Stellantis facility is planned to be completed by the end of 2024 and could produce as many as 90,000 units a year.
Supported by government incentives, the automotive industry accounted for 4.9% of South Africa’s gross domestic product and 12.4% of exports last year, with manufacturers directly employing about 110,000 people, data from the Automotive Business Council show.