BRICS Summit 2023: Tata Motors SA CEO speaks on plans to expand African footprint

Tata Motors, one of India's leading car manufacturers, is eyeing an expansion of its presence in Africa utilizing the opportunities presented by the African Continental Free Trade Area (AfCFTA) agreement. In a recent interview with CNBC Africa, Vikrant Pathre, the CEO of Tata Motors South Africa, shed light on the company's strategies to increase volumes and trade opportunities in the African market. Pathre emphasized the significance of policy changes and the AfCFTA in driving Tata Motors' growth on the continent. The company has been operating in South Africa for the past 12 years, primarily focusing on the assembly and manufacturing of heavy vehicles ranging from four tons to 75 tons. Despite facing challenges due to lower volumes in the South African market, Pathre expressed optimism about the potential offered by the AfCFTA as a gateway to tap into the vast African market. The AfCFTA, which aims to eliminate trade barriers and facilitate economic integration across Africa, is expected to bring about a significant transformation in the region's trade landscape. Pathre acknowledged the game-changing potential of the agreement, foreseeing a substantial increase in volumes and highlighting the anticipated flow of manpower skills across borders as a key aspect. He also discussed the importance of rules of origin in the context of the AfCFTA, noting that while it poses challenges for global manufacturers like Tata Motors, the company is prepared to adapt by establishing local assembly aggregates and collaborating with local component manufacturers. In response to queries about value chain creation in the vehicle manufacturing sector, Pathre emphasized Tata Motors' focus on commercial vehicles in line with infrastructure development needs across the continent. While acknowledging the ongoing discourse on creating value chains in passenger car manufacturing, he underscored the company's keen interest in catering to the demand for commercial vehicles driven by infrastructure projects. The interview also touched upon the issue of the lack of a legal framework around BRICS, with Pathre expressing confidence in the efficacy of the AfCFTA's rules and government interactions to mitigate any potential legal challenges for businesses operating in the region. Overall, Tata Motors South Africa's CEO highlighted the company's strategic alignment with the AfCFTA's objectives and the broader vision of enhancing trade and economic cooperation within Africa. As the automotive industry continues to evolve in the region, Tata Motors stands poised to leverage the opportunities presented by the AfCFTA to strengthen its foothold and contribute to the continent's economic growth.