Ratings agency Fitch confident of Ghana hosting VW plant - GhanaWeb

Business News of Friday, 15 February 2019

Source: citinewsroom.com

VW announced its readiness to start an automobile factory in Ghana last year.

Ratings Agency Fitch says Ghana has the required infrastructure to welcome Germany manufacturing car company Volkswagen to fully operate in the sub-region.

Per a report by the ratings Agency, Ghana is developing quickly and at a fast pace which only goes to show that VW will be better placed in the country.

According to Fitch, VW's target markets, Ghana, Ethiopia and Rwanda, are developing quickly and the fast pace of growth in the 3G and 4G subscribers means that the urban population will be well placed to utilise app-based ridesharing and ride-hailing, such as that proposed by VW.

Furthermore, the report states that mobility concepts can serve as an introduction to car brands that consumers will be able to afford as their disposable incomes rise, while in the meantime providing consumers with an alternative method of personal transportation.

Fitch believes that Ghana, Rwanda and Ethiopia have the required infrastructure and consumer base, although small, to support VW's planned operations in the region.

Fitch says there is a niche market for mobility concepts such as app-based ride sharing or shuttle on-demand services in the sub-Saharan Africa region.

It also noted that the Mobility Concepts target market would benefit from professional tourists, who travel for business purposes and are unlikely to utilize traditional public transport.

Fitch argues that the market has remained relatively untapped due to the significant cost of vehicles in Sub Sahara Africa countries, such as Rwanda, Ghana and Uganda.

VW announced its readiness to start an automobile factory in Ghana last year.

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