German carmaker, Volkswagen will today launch a car assembly plant in Rwanda as it expands its presence in Africa. This factory will be the first of its kind in the East African nation. The German carmaker which builds vehicles in nearby Kenya will also launch its car sharing model in Rwanda, to address the existing problem of mobility in the country.
“Rwanda is a young, modern and digital country – and because of that, it is perfectly suited for new, interconnected mobility services,” said VW Group South Africa CEO, Thomas Schaefer, who is responsible for the sub-Saharan region comprising of 49 countries.
It would be recalled that the Government of Rwanda and Volkswagen signed a Memorandum of Understanding (MOU) to enter into the country in 2016. Following the signing of the MOU, the German car maker carried out a feasibility study on the Rwandan market and ecosystem in order to find the viability of the investment.
“I’m convinced, that our planned business ideas will be taken up well by our customers. The valuable experiences we are gaining from the mobility services here in Rwanda should in future also benefit the Volkswagen brand in other markets,” Thomas said further.
According to the country’s tax collection body, Rwanda Revenue Authority, Car ownership in the country of 12 million people remains very remains low with just over 200,000 private cars registered since 1997.
The Volkswagen Mobility Solutions Rwanda is a $20 million operation which includes an assembly plant located in Kigali Special Economic Zone, car sharing, and ride-hailing system.
The German automaker in January said that it initially plans to build up to 5,000 cars per year, beginning with the Polo and Passat models but in an earlier communication VW said it would begin with assembling 1,000 cars at its new in-country plant, including the Polo and Passat. The Passat model has already been seen on the streets of Kigali and it was also tested during the Transform Africa 2018 Summit which took place held in Kigali in May.
The car-sharing app developed by Awesomity Lab is expected to boost competition among other car rental services present in the country.
What you need to know about the car sharing Model
According to a press release from VW, with the use of a smartphone, its clients can access the app which enables them to unlock and use a car.
All they have to do is just order a VW taxi to move them from one location to another and after using the vehicle, they would leave it at an appropriate parking to serve the next user.
If the first user comes back again for the same service and comfort, he’ll either find the same vehicle or another one parked.
The vice governor of Rwanda’s central bank, Monique Nsanzabaganwa, welcomed this move as an example of much-needed investment in the nation.
“It is a vote of confidence for Rwanda,” she told Reuters. “It is good for job creation in Rwanda and making Rwanda a trusted location for services and in this case, manufacturing.”