Martina Biene, Chairperson and Managing Director of Volkswagen (VW) Group South Africa, has voiced concerns over the sluggish adoption of locally manufactured vehicles in Ghana, urging for policy interventions to bolster the automotive industry in the country.
Speaking at the media launch of the newly assembled Virtus Sedan car in Accra, Biene underscored the challenges facing the automotive sector in Ghana. Despite Volkswagen’s significant investment of approximately US$54 million in establishing its Semi Knocked Down (SKD) production plant in Accra-Tema, with a capacity to produce over 12,000 vehicles annually, only 6,000 locally manufactured or assembled cars were sold in Ghana in 2023, falling short of industry expectations.
Biene emphasized that this trend poses a threat to future investments in the sector unless the government implements effective policy decisions to stimulate demand for domestically manufactured vehicles. She highlighted the importance of restricting the importation of salvaged cars, a measure supported by the industry, to encourage the adoption of locally made vehicles.
Furthermore, Biene stressed the significance of the Ghana Automotive Development Policy (GADP) but called for the enforcement of key elements, particularly the ban on second-hand cars and mortgage facilitation for credit purchases, to fully harness the opportunities presented by the policy.
“The promising progress of the automotive industry in Ghana is the envy of other African countries, especially in West Africa. However, Ghana is not fully harnessing the opportunities presented by GADP to grow into a thriving new car market,” said Biene.
As the President of the African Association of Automotive Manufacturers (AAAM), Biene expressed optimism that implementing the outstanding elements of the GADP could quadruple sales volume in the short term. She reiterated Volkswagen’s commitment to Ghana and its role in the company’s African ambition to become the leading provider of sustainable mobility on the continent.
The concerns raised by Biene shed light on the need for concerted efforts to bolster the automotive industry in Ghana, ensuring sustainable growth and economic development in the sector. With Volkswagen’s investment poised to drive the country’s automotive manufacturing capabilities, effective policy interventions are crucial to realizing the full potential of the sector and positioning Ghana as a hub for automotive innovation and production in the region.