Renault’s hybrid move will power up Morocco’s EV ambitions

Renault Group

• The Dacia Jogger will be made in Tangier from 2024
• Morocco aims to become a hub for electric vehicles and batteries
• The kingdom is the second-largest exporter of cars to Europe

Morocco’s status as a regional electric vehicle manufacturing hub has been boosted by French carmaker Renault Group’s announcement that it will move production of its hybrid model from Romania to Tangier in the second quarter of 2024.

The new production line for the Dacia Jogger model is expected to produce up to 120,000 vehicles per year.

Moroccan trade and industry minister Ryad Mezzour said: “This project reinforces Morocco’s industrial ambition to succeed in the transition towards electrification and sustainable mobility and to position itself as the most competitive automotive hub on a global scale.”

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Established in 2012, Renault’s Tangier plant currently manufactures the Dacia Sandero model, which sold 229,500 units in 2022 and has been the bestselling vehicle in the European retail market since 2017. 

The plant has a policy of producing zero carbon emissions and zero industrial wastewater.

Morocco is fast becoming one of the core engines of the automotive industry’s global transition to EVs. 

“Given that most of the Dacia and Renault models built in Morocco are exported to the EU, and considering the EU’s ambitious average emission standards target – 100 percent reduction in C02 emissions by 2035 – we expect more of the vehicles coming out of the Tangier plant to offer an electrified variant over the long-term,” David Leah, senior analyst for powertrain forecasting at UK-based LMC Automotive, said. 

“Dacia’s announcement to move the Dacia Jogger from Romania to Morocco highlights its commitment to the Tangier plant as a long term export hub to Europe and other regions.” 

He added that Renault has committed to building all-electric micro-cars or quadricycles there, under its Mobilize brand, which will support Morocco’s aim of becoming a hub for the manufacture of battery electric vehicles (BEV) and hybrid cars.

Last year the production of light vehicles in Morocco hit an all-time high of 470,000 – equivalent to 10 percent year-on-year growth. 

In November 2022 The Stellantis Group announced plans to invest more than €300 million ($324 million) to double production capacity at its Kenitra manufacturing facility in the north-west of the country to 400,000 units per year until 2030, along with 50,000 quadricycles in the form of its Citroen Ami and Opel Rocks-e brands. 

Reuters

Essential minerals

Morocco has also been working to position itself as an EV battery manufacturing hub. 

Last July Mezzour announced that the government was planning to sign a deal with several EV battery manufacturers to construct a “gigafactory” in the kingdom. 

The kingdom is home to many of the minerals critical for the manufacturing of batteries. 

Professor Michaël Tanchum is a non-resident fellow with the Middle East Institute’s Economics and Energy Program, who last year published a report titled Morocco’s green mobility revolution.

“Through local mining in cobalt and manganese as well as developing a global business in EV battery recycling in partnership with Glencore, Morocco has positioned itself well to create local sourcing for critical EV battery minerals,” he said.

“Moreover, the industry trend to switch over to lithium iron phosphate batteries favours Morocco, which sits on almost three-quarters of the world’s phosphate rock reserves.”

Tanchum said that this trend, combined with the ongoing regionalisation of supply chains and the short transportation distances between Morocco and European end-markets, will continue to give the kingdom a competitive advantage over EV manufacturers in East Asia and North America.

Zakia Subhan, head of Middle East and Africa production forecasting at LMC Automotive, said she also expects Morocco to become a significant supplier of battery materials to European markets.

Last June Renault announced an agreement with Moroccan mining firm Managem to obtain 5,000 tonnes of low-carbon cobalt sulfate annually, starting from 2025, under a seven-year supply deal. This follows a similar agreement between BMW and Managem a few years earlier.

The advantage of Morocco’s geographical proximity to Europe is demonstrated by the fact that in 2021 Morocco ranked as the second-largest exporter of cars to Europe.

“Trade time to Spain from Morocco is one to two days and although the country neighbours Spain, it has totally different cost structures – labour costs are roughly one-quarter of those in Spain and slightly lower than in Eastern Europe,” Subhan said. 

“For low-cost brands like Dacia and entry-level models from Peugeot, labour costs account for a higher proportion of the vehicle cost, making them a key reason to locate in Morocco.”