Reflecting the rapid transformations in the global automotive market, Chinese automaker GAC Group announced the signing of a strategic agreement with Jameel Motors, a mobility solutions provider, to launch a local production and assembly project of GAC vehicles in Egypt under the CKD (Completely Knocked Down) system. This project represents a qualitative leap in Egypt’s automotive sector and forms part of GAC’s ambitious plan to expand in African markets, especially with the growing interest of Chinese car manufacturers in investing in the continent.
Agreement Details and Implementation Phases
The agreement was announced on May 19, 2025, with both parties confirming that the project will include establishing new production lines specialized in welding, assembly, and vehicle inspection, with mass production expected to begin in the second half of 2026. The project aims to achieve an annual production value exceeding 80 million USD and create more than 1,000 new jobs within the local supply chain, thus boosting the industrial sector’s contribution to Egypt’s economy.
The CKD system involves importing car parts separately and assembling them locally, a common automotive manufacturing method designed to reduce customs costs and support national industry. The project is also expected to include SKD (Semi Knocked Down) models in later stages, allowing greater flexibility in production and development.
The Importance of the Egyptian Market in GAC’s Global Strategy
Egypt is the third-largest automotive market in Africa, with annual sales estimated at around 170,000 units, making it a vital hub in GAC’s globalization strategy. Feng Xingya, Chairman and General Manager of GAC Group, emphasized that the Egyptian market is a key focus in the company’s plans due to its strategic geographic location and significant economic potential.
GAC first entered the Egyptian market in November 2023 through a partnership with Jameel Motors, initially introducing several imported models. Since then, the company has launched four fuel-powered vehicles and established a network of 14 sales and service centers across Egypt.
Expansion in Electric Vehicles and Clean Energy
GAC aims to accelerate the introduction of electric and environmentally friendly vehicles into the Egyptian market, aligning with global trends toward sustainability and emission reduction. The company plans to launch electric models such as the Aion Y and Hyptec HT to meet the growing demand for electric vehicles in the region, especially supported by the Egyptian government’s initiatives for clean energy projects and the transition to more sustainable transportation.
Economic and Social Impact of the Project
The localized assembly project is expected to enhance the national industry and transfer advanced technology to the Egyptian market, in addition to creating new job opportunities and stimulating the supply industries. The project will also help reduce car prices for end consumers by lowering customs costs and localizing a significant portion of the supply chain.
Moreover, the project offers an opportunity to develop local competencies in manufacturing and engineering, positively impacting innovation levels and the competitiveness of Egypt’s industry in the long term.
GAC’s Global Presence
GAC enjoys a broad global presence, operating in 76 countries and regions worldwide, with subsidiaries in Hong Kong, the Middle East, and Mexico. Last month, the company expanded its operations in Europe by signing a new energy vehicle (NEV) distribution agreement in Poland, also in collaboration with Jameel.
This international expansion gives GAC a strong competitive advantage and enhances its ability to transfer expertise and advanced technologies to new markets, including Egypt.
Challenges and Future Prospects
Despite the great opportunities offered by the Egyptian market, the project will face challenges related to macroeconomic fluctuations, changes in customs policies, and consumer acceptance of Chinese vehicles, especially given the competition with well-established European and Japanese brands. Nevertheless, GAC is confident in the quality of its products, competitive pricing strategy, and after-sales services to gain customer trust and build a strong market base.
GAC’s localized assembly project in Egypt represents a strategic step that will reshape the automotive market in the country and the region. With actual production expected to start in 2026, we anticipate growth in the local automotive sector, increased diversity of consumer options, and clear support for the transition toward electric vehicles and clean energy in Egypt and Africa.
Tamara is an editor who has been working in the automotive field for over 3 years. She is also an automotive journalist and presenter; she shoots car reviews and tips on her social media platforms. She has a translation degree, and she also works as a freelance translator, copywriter, voiceover artist, and video editor. She’s taken automotive OBD Scanner and car diagnosis courses, and she’s also worked as an automotive sales woman for a year, in addition to completing an internship with Skoda Lebanon for 2 months. She also has been in the marketing field for over 2 years, and she also create social media content for small businesses.
