April 24, 2012
The first automobile assembling plant in Ethiopia, Holland Car Plc, has sealed a deal to assemble the Ahadu Bus and Abay Executive through a Joint Venture (JV) with TRC-City, a transport company based in the Democratic Republic of Congo (DRC). The car assembling company plans to showcase its first assembled bus in DRC within the coming four months.
Holland Car has invested 8.5 million birr to develop the first trailer bus in the country according to Tadesse Tessema (Eng.), General Manager of the company. It marketed the new product at a cost of 1.6 million birr. However, the bus which has the capacity to carry 250 people at a time was not put into service due to the low level of demand at home.
The largest city bus operator in the country, Anbessa City Bus Enterprise, has ordered 500 new buses to be assembled by the recently established military engineering complex; Metal and Engineering Corporation. This move by the Addis Ababa City Government has watered down the company’s plan to cash in from the potential lucrative deal. The unexpected move by the city government forced the car assembling company to search for an alternative market that resulted in the formation of the JV. The company is also soliciting talks to market its products in Ghana.
Holland car owns thirty percent share in the JV of the new assembly plant to be erected in Kinshasa. The remaining 70 percent is shared equally among two founding partners of TRC-City according to the manager.
Ahadu City Bus will be marketed in DRC under a new brand name; Trans City.
Holland Car assembles the spare parts imported from a Chinese automotive producer, JAC Motors, at its factory located in Modjo town of the Oromiya Regional State, 70Km south east of Addis Ababa.
The company has recently introduced a new engine called VVT (Variable Valve Timing). VVT is an engine that controls the opening and closing time of intake valves according to different working conditions of the engine to improve its power performance while decreasing fuel consumption.
According to experts, VVT engine is made of aluminum. It decreases fuel consumption by more than six percent, weight by 29 percent and improves the power of a car by more than 10 percent.
Holland car is making preparations to take its car assembly process a step further by shifting to complete knockdown, where all the parts will be imported in pieces to be welded, painted and assembled in Ethiopia.
So far it has been assembling vehicles from semi knockdown kits, where parts are welded, painted and assembled externally. In its earlier relationship with Lifan Motors and now with Anhui Jianghuai Plc (JAC); Holland Car receives semi knockdown kits.
In a complete knockdown, the parts, including the internal combustion engine and the transmission, will be supplied in parts for assembly by the receiving company. The company will need to set up body coating line, welding line, engine assembly line and mechanical testing line which could cost it 35 million birr.
Holland Car was established in 2005 through a JV between TadesseTessema (Eng) and Trento Engineering, a Dutch company, to supply assembled vehicles for local and export markets. It is the assembler of Awash Executive, Abay Executive, and Shebelle cars. The company is also in the process of introducing five more new automobile brands namely Imay, Tekeze, Naomi, Lalibela, Dalol, and a minibus called Meskerem. It was established with an initial capital of 11 million birr equally contributed by both business partners. The company is currently assembling 120 cars while 450 more cars to be assembled are at Djibouti Port according to the manager.
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