Yamaha Motor Co. Ltd. has announced a new joint agreement to establish a motorcycle manufacturing and sales company in Nigeria. Factory operations are scheduled to commence in summer 2015.
The new company, called CFAO Yamaha Motor Nigeria Ltd. (CYMNG), is a joint venture between Yamaha Motor and CFAO - a French company, specialised in distribution of major international brands in Africa and part of the Toyota Tsusho Group.
The two companies will make equal investment contributions towards a start-up capital of one million dollars. The factory is to cover an area of 2,790 m2, and will be constructed on a site owned by CFAO in Lagos, the former capital and Nigeria's biggest city. The factory is expected to employ 200 people and produce 70,000 motorcycles by 2018.
In 1980, Yamaha Motor established a motorcycle factory in Nigeria that carried out manufacture and sale of motorcycles; however, in 2005 Yamaha pulled out of production at the factory due to a decline in the market, and have since been selling motorcycles imported from Japan or India through local dealerships. This joint venture represents Yamaha Motor’s second foray into the Nigerian market.
The population of Nigeria is currently 170 million, and explosive growth in the population and economy have contributed to growth of the motorcycle market to reach 1.3 million units in 2013. Moreover, the market is anticipated to grow in scale to 1.8 million units by 2020 as individual demand increases to supplement use of taxis, which currently accounts for 70% of demand. Nigeria is Africa's largest motorcycle market.
