Car Dealers Association: 60% Local Content Means Full Manufacturing and Radical Economic Change

Mahmoud Hammad, Vice President of the Car Dealers Association and head of its used car division, confirmed that raising local content in car manufacturing to 60% or 70% effectively equals full manufacturing by global standards. He stressed that this achievement would radically reshape the Egyptian economy, citing Egypt's success in bus manufacturing which currently exports worldwide with local content ratios between 60% and 70%.

Why No Country Manufactures 100% of Any Car

Global manufacturing depends on industrial integration between nations. No single country produces a complete car from scratch at 100%, but instead relies on supply chains spanning 20 to 30 different countries. Egypt wants to become a key player in these chains rather than a mere importer.

Hammad explained during his television interview that core components like the engine and gearbox alone represent about 40% of a car's local content value. The wiring harness, glass, and electronic chips add further complexity to the national industry's challenge.

The gap is real. Overcoming the engine and transmission production hurdle will push domestic manufacturing toward unprecedented horizons. A vehicle with locally produced engine and gearbox gains genuine added value that can't be achieved through any other means.

Impact on Exports and National Currency

Achieving these local content ratios grants Egyptian-made products in Cairo and all governorates a strong competitive edge. A local factory reaching this percentage can compete in foreign markets, directly opening export doors for Egyptian car companies.

The benefits extend beyond factory walls. Supporting the national currency follows naturally from increased exports and reduced import dependency—every additional percentage point in local content value means saving foreign currency that would otherwise leave the country for imported parts.

Egypt already possesses the expertise and infrastructure required. The bus sector proved that national industry can exceed 60% local content and compete globally, leaving one question open: when will this success transfer to the passenger car segment? Integration across industrial components and supportive policies will determine how quickly Egypt reaches this ambitious goal.