IceTea
06-02-08, 10:14 AM
MUSCAT — An agreement was signed here yesterday for the establishment of Oman’s first ever automotive assembly plant with an initial investment estimated to be well in excess of $150 million. The project, which is backed by a group of Omani, Qatari and Kuwaiti investors, as well as a Malaysian automotive firm, will be set up at the Buraimi Industrial Estate in the Governorate of Buraimi. Yesterday, the joint venture partners signed an MoU to set up a company that will oversee the development and management of the facility.
A major share of the investments will come from Oman-based Abu Razan Modern Projects and Hala Investments, while Qatar’s Shaikh Hamad bin Mohammed bin Jaber al Thani, and Kuwait-based West Star Investments are also backing the project. Malaysia’s Evacorp Resources Pvt Ltd, a Kuala Lumpur based automotive firm, is named as a ‘strategic partner’ in the venture. Following the signing ceremony, at the Grand Hyatt Muscat, the promoters also made a detailed presentation on the project to a gathering of senior representatives from the government, local banks, Omani business houses, and prospective investors.
Earlier, in remarks to the Observer, Mohammed Khalfan al Handhali, who represents the Omani shareholding in the venture, said the project aims to introduce a new type of industrial activity into the Sultanate’s rapidly diversifying manufacturing base. “Our aim is to test the appetite of the market by initially establishing a Complete Knock Down (CKD) assembly plant in the first phase. Eventually, we aim to launch the Gulf’s own indigenous brand of automotive vehicle, with the Sultanate of Oman as the launchpad for this initiative.” Al Handhali is Chief Executive Officer of Al Omania al Qatariya Assembly Plant, a new company set up by the joint venture partners to develop, operate and manage the facility.
Asked about the estimated investment in the venture, the CEO declined to reveal a definitive figure, but noted it would be far in excess of $150 million in the first phase alone. Yesterday’s MoU, Al Handhali said, brings to fruition more than two years of market study designed to establish the viability of an automotive plant in Oman — the first of its kind in the entire Gulf region. “The GCC is the world’s largest market for cars, and yet lacks its own automotive manufacturing capability. We are now concluding this MoU after two years of market research, and with enough confidence that the project is attractive and viable.”
Oman is ideally positioned to host the plant, given its strategic geographical location and its proximity to potential markets in the Gulf, Middle East and Africa, said Al Handhali. The plant’s location in Buraimi would also allow for its cars to be shipped through Dubai, Saudi Arabia and Sohar, he added. The company’s locally assembled cars would come in several price categories catering to various price segments, although quality would be an overriding factor in its marketing strategy, he noted. Technology for the project will be sourced from Malaysia, Japan and elsewhere. Underlining the ambitious size of the project, a plot of land of around 500,000 sq mt has been allocated within the Buraimi Industrial Estate. Construction of the plant is expected to commence early next year.
“We plan to tender out the main components of the project by the end of this year. Actual development will begin early in 2009, with the plant set to come into operation two years thereafter.” Significantly, between 500 and 800 jobs will be created as a result of this investment, with employment numbers set to grow when the second phase is implemented, said the CEO. “A new technological stream is being introduced with the launch of this project. Our Malaysian partner will provide technical expertise to our plant personnel. We will also send our staff for training in Malaysia and China. Upon the completion of the factory, we also plan to set up a specialised institute that will train Omanis and GCC nationals in automotive engineering skills.”
http://www.omanobserver.com/
A major share of the investments will come from Oman-based Abu Razan Modern Projects and Hala Investments, while Qatar’s Shaikh Hamad bin Mohammed bin Jaber al Thani, and Kuwait-based West Star Investments are also backing the project. Malaysia’s Evacorp Resources Pvt Ltd, a Kuala Lumpur based automotive firm, is named as a ‘strategic partner’ in the venture. Following the signing ceremony, at the Grand Hyatt Muscat, the promoters also made a detailed presentation on the project to a gathering of senior representatives from the government, local banks, Omani business houses, and prospective investors.
Earlier, in remarks to the Observer, Mohammed Khalfan al Handhali, who represents the Omani shareholding in the venture, said the project aims to introduce a new type of industrial activity into the Sultanate’s rapidly diversifying manufacturing base. “Our aim is to test the appetite of the market by initially establishing a Complete Knock Down (CKD) assembly plant in the first phase. Eventually, we aim to launch the Gulf’s own indigenous brand of automotive vehicle, with the Sultanate of Oman as the launchpad for this initiative.” Al Handhali is Chief Executive Officer of Al Omania al Qatariya Assembly Plant, a new company set up by the joint venture partners to develop, operate and manage the facility.
Asked about the estimated investment in the venture, the CEO declined to reveal a definitive figure, but noted it would be far in excess of $150 million in the first phase alone. Yesterday’s MoU, Al Handhali said, brings to fruition more than two years of market study designed to establish the viability of an automotive plant in Oman — the first of its kind in the entire Gulf region. “The GCC is the world’s largest market for cars, and yet lacks its own automotive manufacturing capability. We are now concluding this MoU after two years of market research, and with enough confidence that the project is attractive and viable.”
Oman is ideally positioned to host the plant, given its strategic geographical location and its proximity to potential markets in the Gulf, Middle East and Africa, said Al Handhali. The plant’s location in Buraimi would also allow for its cars to be shipped through Dubai, Saudi Arabia and Sohar, he added. The company’s locally assembled cars would come in several price categories catering to various price segments, although quality would be an overriding factor in its marketing strategy, he noted. Technology for the project will be sourced from Malaysia, Japan and elsewhere. Underlining the ambitious size of the project, a plot of land of around 500,000 sq mt has been allocated within the Buraimi Industrial Estate. Construction of the plant is expected to commence early next year.
“We plan to tender out the main components of the project by the end of this year. Actual development will begin early in 2009, with the plant set to come into operation two years thereafter.” Significantly, between 500 and 800 jobs will be created as a result of this investment, with employment numbers set to grow when the second phase is implemented, said the CEO. “A new technological stream is being introduced with the launch of this project. Our Malaysian partner will provide technical expertise to our plant personnel. We will also send our staff for training in Malaysia and China. Upon the completion of the factory, we also plan to set up a specialised institute that will train Omanis and GCC nationals in automotive engineering skills.”
http://www.omanobserver.com/