Exports from Morocco's automotive industry continue to grow

Last year, the automotive sector, an ever-expanding industry in Morocco, achieved a new success. The sector succeeded in dethroning phosphates to become the country's largest export industry.  

Exports related to this sector amounted to 141.7 billion dirhams ($13.9 billion) at the end of 2023, up from 111.2 billion dirhams ($11 billion) the previous year. That's an impressive 27 per cent year-on-year increase, according to a recent report by the bureau de change (OE), the country's foreign trade watchdog.  

According to Morocco World News, the growth in automotive exports was driven by the expansion of the automotive sector and businesses related to automotive wiring, which involves the assembly of electrical wires, connectors and other components to create the wiring system inside a vehicle. By the end of 2023, exports from the wiring sector also experienced a dramatic 32% increase, achieving 46.1 billion dirhams ($4.5 billion). 

Similarly, the automotive construction industry, which encompasses the manufacture and assembly of structural components, body panels, chassis and other essential parts, grew at an annual rate of 22%. Exports related to this sector reached 67.6 billion dirhams ($6.7 billion). 

Meanwhile, the propulsion systems industry, which manufactures internal systems for vehicles, recorded an annual growth rate of 25%. These exports exceeded 11.3 billion dirhams (1.1 billion dollars). 

As the Moroccan media recalls, since 1957 the automotive sector in Morocco has undergone a transformation from mere vehicle assembly to general production. In recent years, production has increased and, in 2021, the Kingdom manufactured a total of 403,007 units, of which 8.3 billion dollars were exported. 

This growth led to the creation of some 220,000 jobs in the industry. In addition, a network of more than 230 Tier 1 and 2 suppliers emerged, contributing to a local integration rate of 60%. 

Thanks to specific government policies that eased the way for the creation of massive infrastructure projects, as well as a favourable business climate, Morocco established itself as a continental leader in the automotive industry. 

Within these state policies, the Industrial Acceleration Plan 2014-2020 stands out for example, along with the construction of industrial parks and automotive cities such as Kenitra and Tangier that have boosted the automotive ecosystem.  

On the other hand, at the global level, Morocco's integration into the world economy through free trade agreements has further solidified its attractiveness to investors, according to UNCTAD's 2023 report.  

Also, domestically, the country's engineering research and development capabilities have increased, making Morocco Africa's leading automotive testing centre. In addition, Stellantis established an automotive technical centre near Casablanca. 

Despite this optimal situation, Morocco's ambition is to reach an annual production of one million cars by 2025, while raising the local integration rate to 80%.  

In 2020, the Kingdom already reached an annual production capacity of 700,000 vehicles. The government's strategies focus in particular on improving local integration, expanding industrial activities, upgrading the value chain, facilitating technology transfer and diversifying export markets.   

Morocco positioned itself as a leading production centre, attracting several major groups such as German Motor Distributors, Renault, Snop, Stellantis Sumitomo Electric Wiring Systems and Yazaki. 

The country's automotive industry reached an important milestone as the focus of manufacturing is shifting towards complex, high-value components, including engine manufacturing, engineering, as well as research and development. It is also worth mentioning that the country produces between 40,000 and 50,000 electric vehicles per year.

However, as domestic vehicle registrations remain low (175,435 units in 2021), the main focus for vehicle assembly is the European market. 

Renault, for example, exports most of its production despite having the largest assembly plant, with a capacity of 400,000 units. The Citroën Ami, produced in the Moroccan city of Kenitra, emerged as the best-selling vehicle in Spain in 2022.