On a journey lasting no more than 30 minutes, five trains a day travel to the port of Tanger Med carrying freshly assembled vehicles directly from a Renault’s factory roughly 30km away. Once they arrive, they are swiftly loaded onto cargo ships ready for export.
Last year, the factory, which is located roughly 2km from Tanger Automotive City (TAC), produced some 255,000 vehicles.
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“When I arrived in Morocco in 2009, there was only one [Renault] plant in Casablanca which made approximately 20,000 cars per year,” recalls Christophe Dridi, vice president of industry at Dacia, the Romanian car manufacturer Renault bought in 1999. “Now, we produce more than 350,000 cars in Morocco across our Tanger Med and Casablanca plants.”
Mr Dridi explains that Renault’s plant in Tanger Med now represents 17% of the group’s global production and more than 50% of its production of Dacia vehicles.
“In 30 years of my life, I don’t have any other experience of the automotive industry growing so fast. Imagine: in only 10 years, the Tanger [plant] is as big as any large-scale car plant in the world,” he adds.
Automotive exports
Between January and August this year, Morocco’s automotive exports have reached 90.4bn dirhams ($8.8bn), according to the country’s foreign exchange office, a jump of 35.6% year on year. This highlights the sector’s position as its pre-eminent export, ahead of agriculture and textiles.
Roberto Cardarelli, the IMF’s mission chief for Morocco, says that the country’s automotive exports, which have been spurred on by the industrialisation of Tanger Med, have provided a “buffer” to external shocks to the economy, such as the Covid-19 pandemic. “One explanation for why Morocco has been resilient is that, post-Covid-19, the automotive sector rebounded,” he says.
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Morocco recorded real ross domestic product growth of 7.9% in 2021, according to World Bank figures, before slowing to an estimated 1.2% in 2022.
As for the train line connecting Renault’s factory with the port, Mr Cardarelli says that this is an illustration of the “infrastructure attractiveness for big foreign players to relocate to Morocco”.
This is part of the government’s strategy of “opening up to international trade and diversifying the structure of the economy by joining global value chains”, he continues.
Not just automotives
Behind the storied success of exported cars and components, the industrialisation of Tanger Med spans textiles, aeronautics, electronics and agri-food processing.
Julianne Furman, general manager at Polydesign Systems, an automotive supplier, who has been in Morocco for nearly 30 years, points out that other sectors, ranging from aeronautics to textiles, have benefitted from the growth of the automotive sector.
“The growth and momentum of the automotive sector has meant that other sectors have flourished too. I wouldn’t be so arrogant to say that we’re responsible for pulling everything else up, but we’ve all helped each other,” she says.
One example of this horizontal industrial development she cites is the aeronautics industry. At Polydesign Systems, Ms Furman explains, it is part of the company’s strategy to expand its supply of wire harnesses to aeronautics as well as automotive companies.
On top of this, the textiles industry, one of the country’s mainstays, also benefited, she says.
“As the automotive industry was ramping up, it seemed like the textiles sector was going to be a victim or left by the wayside. But what has actually happened is that it has become more competitive,” she says.
After the pandemic sent customers looking for alternatives to Asia, Morocco’s position was reinforced as a “sourcing platform for Europe”, says the Moroccan Association of the Textiles and Clothing Industry.
Between January and April this year, exports in textiles and clothing reached their highest level in seven years, according to the trade association.
Tanger Med-based fashion garments supplier Vita Couture established a presence in the industrial zone in 2017, having previously been a tenant of Zone Industrielle Al Majd, an older zone that was set up in 1989 and is also located in the Tanger-Tétouan-Al Hoceima region.
The company, which has its manufacturing facility in Tanger Med, sources its fabrics mainly from Turkey or Italy and counts fast fashion multinationals Inditex and H&M among its clients.
“As a textile fashion company, all of our customers are asking for nearshoring coupled with shorter lead times,” says Mohamed Benajiba, co-founder and director of Vita Couture. “As we have our factories in the free zone and our subcontractors [are] in the free zone, it is a no brainer.”
Local integration
Still, the automotive industry is the biggest of Tanger Med’s success stories and, with its mature ecosystem, offers the most promise for the future.
Michel Jacinto, senior associate at S&P Global, says that TAC, the industrial zone dedicated to the sector, is a pillar of the country’s automotive ecosystem. “This is not just in the assembly but in the ecosystem: the services in research and development, suppliers, logistics,” he says. “The advantage of this is there is a concentration of companies which work on the same technology, sharing ideas, which in turn is important for innovation and risk-taking, especially when it comes to new vehicles, like electric vehicles.”
Overall, Morocco boasts a network of more than 230 tier 1 and 2 automotive suppliers with a local integration rate of 60%, according to a 2023 Unctad report on economic development in Africa.
Last year, carmaker Stellantis invested €300m into its Kenitra manufacturing plant, as it looks to double the site’s production capacity to 400,000 vehicles per year and 50,000 electric vehicles.
Kenitra is located outside the industrial zones of Tanger Med but relies on it as a “partner”, says Mounir Kharbouche, general manager of Stellantis’s Kenitra plant.
“Tanger Med is a partner, not just a simple supplier,” he says, adding that Stellantis uses Tanger Med to export cars but also import parts from elsewhere. The plant sources 40% of its imports from TAC, 30% from nearby Kenitra and 30% from international imports which come through Tanger Med, Mr Kharbouche says.
“Kenitra is now key to our strategy for the [Middle East and Africa] region to have local production for local customers,” he says, as well as being a key hub for the production of micro vehicles, or the smallest size of car.
Meanwhile, rival Renault has announced that it will make its own electric microcar, the Mobilize Duo, at its plant in Tanger Med, as well as the hybrid Dacia Jogger.
As for the famed shuttle service between factory and port, “the train will keep running”, Mr Dridi says with pride. “It is already CO2 friendly. It’s better than [having] trucks.”
This article is part of the Special Report:
Tanger Med's rise as a nearshoring hub