Beijing Automotive Industry Holding Company (BAIC) has told reporters in China it plans to build a full size vehicle assembly plant in Port Elizabeth, South Africa, at a cost CNY5bn (US$770m).

Construction is scheduled to begin in June with initial production scheduled to start in November 2017, followed by commercial production in 2018. It will have a designated annual production capacity of 100,000 vehicles – worth some CNY12.4bn ($1.9bn). 

The factory will be the largest Chinese vehicle assembly plant in Africa, producing passenger cars, SUVs, MPVs and light vans. At full capacity it will employ 2,500 people directly and more than 10,000 indirectly. 

The new facility is a joint venture with Industrial Development Corporation, a South African venture capital company.

BAIC already has a minibus assembly plant in Springs, South Africa – with a current workforce of 500 – which it established in 2013. It also has a light truck plant in Nairobi, Kenya. These plants will continue to operate.

BAIC said local production would allow it to avoid South Africa's 25% import duty. Around 50% of output will be exported, mainly to other markets in the region.