Case Study: Construction of KD Factory in Ethiopia
Project Overview:
In 2022, ZMEV LIMITED signed a strategic cooperation agreement with local enterprises in Ethiopia (including chain sales companies and banking institutions) to plan the construction of a KD factory. The four step approach involves "local independent research and development of SKD CKD local supply chain system construction". The goal is to introduce mature new energy vehicle production technology from China to help Ethiopia achieve autonomy in the automotive industry. We plan to complete this process in about 10 years and achieve annual production and sales of 100000 new energy vehicles.
Overview of the Ethiopian market:
Ethiopia has established diplomatic relations with China for over 50 years, and over the past 10 years, Ethiopia's gross domestic product has grown by an average of about 8%. China has become Ethiopia's largest trading partner. Ethiopia is the second country in Africa with the greatest potential for water resources, and its advantages in oil and electricity pricing are very obvious, making it very suitable for developing new energy vehicles.
The local government of Ethiopia supports the development of new energy vehicles. The Ethiopian Ministry of Finance announced that imported and assembled electric vehicles will be exempt from value-added tax, consumption tax, and additional taxes, and import tariffs will be further reduced. In addition, in order to accelerate the electrification of government vehicles, the government proposes to increase the number of electric vehicles in the government fleet to over 100000 by the end of 2021.
Meanwhile, based on the resources accumulated by our local partners, we have unique advantages in foreign exchange reserves and channel construction.

Division of labor for cooperation between both parties:
Ethiopian partners are responsible for providing land, factories, office space, and supporting operating funds, as well as integrating Ethiopian and African markets and government resources to expand local market channels and manage factory construction.
Chinese partner ZMEV Limited is responsible for production line equipment, technical management, product introduction, team training, and introducing advanced new energy vehicle models and manufacturing processes from China to help improve the local automotive industry system.

Project construction plan:
Year T: Start the first phase of SKD factory construction, with a construction period of approximately 6 to 9 months. The goal for the first year is to achieve production and sales of 5000 to 8000 vehicles. Within five years after the first phase is put into operation, efforts will be made to launch 3 to 4 models.
T+5 years: Start the second phase of CKD factory construction, with a construction period of 18 months. Within five years after the second phase is put into operation, efforts will be made to launch one or two self-designed car models.
T+10 years: Launch the third phase of project construction, with a construction period of 12 to 24 months. The third phase of the parts industrial park will gradually be put into operation, and the parts will be basically localized. The factory will basically achieve full production.
T+15 years: Self designed car models will be launched. The Ethiopian Automotive Research Institute will be officially put into use, and the first vehicle designed by the institute in Ethiopia will be launched.

We welcome more overseas friends to negotiate cooperation with us in the construction of KD factory. We will provide you with professional investment and construction plans for new energy vehicle factories, and introduce China's well-established new energy vehicle supply chain system to help overseas customers achieve prosperity in the national automotive industry.