The Tangier project, which Renault has said will create 6,000 direct jobs and 30,000 indirect jobs in the region, and which will have an initial production capacity of 200,000 vehicles per year by 2010 and 400,000 per year thereafter, is viewed by some as part of a larger move in the European car industry attempting to react to the low costs available to car manufacturers in Asia and China.

Renault-Nissan CEO Carlos Ghosn and Moroccan Prime Minister Driss Jettou signed a memorandum of understanding in Morocco earlier this month. The company and the Moroccan government are expected to sign a more binding general agreement by the end of the year.

As Renault officials have already stated that the Tangier facility, located in a free-trade zone in the city’s port, will be more competitive than the company's plants in Romania and Turkey, and at least as inexpensive as Nissan's current operation in China, the trajectory for additional possible endeavors by the automotive industry in the region is being widely discussed.

"This is all part of the Logan strategy to open multiple venues, a strategy that was always to have a plant off the Mediterranean in one of the North African countries," says Krish Bhaskar, an automotive consultant who helped to found the Motor Industry Research Unit (MIRU) while at Britain's University of East Anglia. This strategy is not necessarily just to build it for Morocco, but to build for the whole region, exporting (cars) to Africa and Europe.

Indeed, some observers see Renault-Nissan's new North African foray as a key component of its stated strategy to spread the use of their low-end but popular Logan automobile, which was launched in 2004 and became unexpectedly popular in Europe as well as in its original Middle East and African target markets. Because of its modest cost and popular appeal, the Logan has sometimes been referred to as the Easyjet of cars, in reference to one of Europe’s no-frills airlines.

Thus far this year, Renault has sold some 30,000 Logans in France, and 20,000 in Germany. Over 90 percent of the cars produced on the 300-hectare Tangier plant will be for export, with the remaining 10 percent slated for the domestic Moroccan market. Currently, the combined operations of Renault and Nissan command one-third of the Moroccan car market.

When put in tandem with other major car manufacturing operations in Libya and Tunisia and a fiercely competitive atmosphere existing between manufacturers in pursuit of the ultimate low-cost, mass-appeal vehicle, North Africa might be well-placed to take advantage of its historic position as a bridge between Europe to the north and Africa to the south.

"This could be a template for similar operations," says Professor Garel Rhys, an automotive industry analyst with Cardiff Business School in Wales. "The North African market is a very attractive one."

"You’ve got the usual attraction of a low-cost and large labor pool, but you also have the advantage of bringing in components from France and Spain and other places where Renault has operations already," Professor Rhys told IPS. "You can make a low-cost car, but not a cheap and shoddy car."

For its part, the new Morocco facility, massive as it is planned to be, also represents a continuation of Renault’s historic presence in Morocco, which gained its independence from French and Spanish spheres of influence in 1956.

The company has been assembling vehicles at a Société Marocaine des Constructions Automobiles plant outside of Morocco’s largest city, Casablanca, since 1966. Further cementing the links between Renault and Nissan, the Morocco facility will represent the two automotive giants’ second joint factory, following in the footsteps of one already functioning in Curitiba, Brazil.

Source: Inter Press News Service