SAIC Motor’s US$135 Million Deal in Egypt: A Strategic Move Amid Global Trends

Chinese state-owned SAIC Motor Corp. Ltd. has partnered with the Mansour Group in Egypt in a US$135 million deal to set up an automotive plant in New October City.

By Estelle Xiao

Chinese state-owned carmaker SAIC Motor Corp. Ltd. has entered into a US$135 million agreement with Egypt’s Mansour Group to establish an automotive manufacturing plant in New October City, Egypt. The facility will produce MG-branded vehicles, with initial production expected to commence in the second quarter of 2026. Starting with an annual capacity of 50,000 units, the plant’s output is expected to double over time.

Mansour Group, which acquired exclusive distribution rights for MG vehicles in Egypt in 2018, has successfully positioned the brand as a leading player in the country’s passenger car market. This agreement was officially announced on December 29, 2024, reflecting a significant milestone in the growing collaboration between Chinese automakers and local partners in key international markets.

Global market trends driving the SAIC Motor-Mansour deal in Egypt

The SAIC-Mansour deal reflects a broader trend of Chinese automakers establishing overseas production facilities to tap into new markets and counter challenges in their home and traditional export markets. With intense competition in China’s saturated automotive market and increasing trade barriers in regions like the European Union and the United States, Chinese manufacturers are pursuing global diversification.

Key regions for this expansion include Southeast Asia, Latin America, and the Middle East, where demand for vehicles is growing, and local governments often provide incentives for foreign direct investment. For instance, companies like Chery and BYD have already established a strong foothold in these regions, with Chery reporting a 38.4 percent jump in global sales in 2024. These automakers are not only entering markets but also introducing new energy vehicles (NEVs) like electric and hybrid cars, leveraging their technological advancements to meet global emission standards and appeal to environmentally conscious consumers.

The Middle East, in particular, offers unique opportunities for Chinese automakers. The region’s increasing openness to foreign investment and strategic location as a hub for trade make it an attractive destination. By setting up local manufacturing facilities, companies like SAIC can reduce logistics costs, circumvent potential trade restrictions, and better adapt to local market demands. Partnerships with established local entities, such as Mansour Group, further enhance their ability to navigate market dynamics and consumer preferences effectively.

Strategic implications and outlook

SAIC’s investment in Egypt represents a calculated move to solidify its presence in the Middle East. The choice of Egypt is strategic, given the country’s position as a gateway to African and Middle Eastern markets, its growing consumer base, and government policies favoring industrialization and foreign direct investment.

Additionally, this venture aligns with the broader Belt and Road Initiative (BRI), which promotes infrastructure and economic ties between China and participating countries. By establishing a manufacturing hub in Egypt, SAIC not only gains access to local and regional markets but also strengthens economic ties with a key partner in the initiative.

Looking ahead, the success of this project could pave the way for other Chinese automakers to deepen their presence in the Middle East. The plant’s focus on producing next-generation vehicles, including NEVs, positions SAIC to capitalize on the region’s growing interest in sustainable mobility solutions. Moreover, this move underscores a shift in the global automotive landscape, where Chinese automakers are transitioning from being primarily exporters to becoming integrated players in international markets through localized production and partnerships.

SAIC Motor’s collaboration with Mansour Group highlights the strategic importance of the Middle East in Chinese automakers’ global expansion plans. As these companies continue to navigate domestic and international challenges, their investments in regions like the Middle East are reshaping the global automotive industry. The success of such initiatives will depend on their ability to adapt to local conditions, innovate in response to market demands, and build lasting partnerships.

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