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Made in Ethiopia: The story of Holland Car

When Tadesse Tessema’s company first started to sell its locally assembled cars in Ethiopia, one of the biggest challenges was to convince the public that its vehicles were of the same quality as the brands imported from the west.

Holland Car's Awash Executive model in Addis Ababa.

Holland Car's Awash Executive model in Addis Ababa.

“Our main achievement is that we have been able to change the minds of the people,” says Tessema, general manager of Ethiopia’s first indigenous vehicle assembly company Holland Car.

Born in Ethiopia, Tessema lived in the Netherlands for many years. During his occasional visits to Ethiopia he discovered a big demand for cars. So he created a company which exported used vehicles from the Netherlands to Ethiopia. After a while he, however, spotted an opportunity for local assembly. “I thought, why don’t I go back and assemble new cars in my country.”

To access funds for the new business, Tessema went into a joint venture with a Dutch firm, Trento BV Engineering. This allowed Holland Car to obtain additional funding from the Dutch government. After launching operations in 2005, the company in 2006 celebrated its first assembled car during a ceremony at the Hilton hotel in Addis Ababa.

All car parts are imported from China and assembled at a facility outside the capital. The Daily Monitor newspaper earlier reported that Holland Car used to import parts from Chinese auto manufacturer Lifan Motors. This partnership was later ended and the company currently works with JAC Motors.

At first the assembly plant was only able to turn out one car per day, but following additional investments and facility improvements, the company currently has the capacity to produce up to six units. Tessema wants to increase this to ten cars per day. He also has plans to go from assembling cars to manufacturing the parts as well.

All Holland Car’s models are named after rivers in Ethiopia, with names such as Abay, Tekeze and Shebelle. Tessema says this is to emphasize the cars’ local credentials and to foster a sense of national pride.

Plans are also underway to roll-out a biogas powered car. The goal is to not only assemble the vehicle, but to also produce the gas itself. Holland Car is, however, seeking further government assistance before going into full-scale production. “From the distance we have travelled so far, we have come to the conclusion that there is nothing to hinder us from manufacturing biogas cars here in Ethiopia,” reads a statement on Holland Car’s website. In addition, the company is also marketing a mass transportation bus designed and manufactured in Ethiopa, for both the local market as well as the rest of the continent.

With a population of around 80 million and double-digit GDP growth rates in recent years, many are viewing Ethiopia as the next big investment opportunity in Africa. Last month, Ethiopia’s newfound importance as a business destination was confirmed when it was announced that the 2012 World Economic Forum on Africa will be held in Addis Ababa.

Tessema says that companies like Holland Car are changing perceptions of Ethiopia. He said that “the sky is the limit” for investors looking to do business in the country and that “now is the time” to invest.

Africans themselves need to grab hold of the opportunities on the continent. “Investors from Asia are coming to invest money here, while we Africans still sit down and wait,” Tessema notes.

He believes that the African diaspora can play a significant part in the continent’s transformation. “If 10% of these people can come back to Africa, most of the problems in Africa would be solved. Governments have to give the opportunities . . . and incentives to bring these people back . . .”

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  • Bravo Tadesse! I take off my hat to you. As you said we should think positive about our country and participate on the positve aspects of our country and the people to get out of poverity. Thanks for showing us the possblitis on the ground, for some of us (the diasporas ) that are hunging on the fance and waiting for a miracle to win our heart to make the leap.

  • Cars of Africa/World

    They should change the name though, maybe a name to reflect Ethiopian heritage, or something based off of the name of the city where the cars are built.

  • Cars of Africa/World

    I agree that this is good for jobs, but hopefully in a few years Holland Car will start developing and selling their own cars from the technology transfer and ideas garnered from assembling Lifan and JAC CKD kits. Also, I think they should develop a truck/commercial brand as that is a large sector that is mostly untapped in Europe.

  • Antoine Ngono

    The main news here is “Jobs”. this is a great way of creating jobs if they can sustain it.

  • Cars of Africa/World

    Holland Car should expand and start selling cars in Europe, India, and North/South America. IF they can be successful and make a profit, maybe they can convince other countries in Africa to start making cars.

    Or, if it does turn out well for Holland Car, maybe Kenya will try to restart the Nyayo car program that they had canceled in 1999.

  • Tariku Hussein

    The problem for investors in Ethiopia is the risk of competing with firms owned by the ruling party, which are present in almost every sector. Even if the government were scrupulous in keeping a level playing field (which it is not), investors will be wary of Ethiopia as long as there is such high potential for naked political favouritism.

  • Henock

    It is general truth. Holland car has got a great achievement in this new business. The cars which are produced by the company the most accepted cars in Ethiopia. Even the mass transportation bus designed and manufactured by the company, enforced the government to assemble almost the same type of bus which is already copied from Holland car company.
    We expect more from Holland car
    Keep going!!!!!

  • Peter

    Nice to hear that cars are now built in Africa. I think the name of the company in Ethiopia should be changed from HOLLAND CAR to ETHIOPIAN, AFRICAN or CHINESE CAR to reflect where thee cars are made.

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