New jobs in the Tunisian automotive industry

Tunisia is an important location for export-orientated companies. It has free trade agreements with the countries of North Africa (Euromed), with Eastern and Southern Africa (COMESA) and with many Arab countries (GAFTA). There are also close trade links with the EU. The population is young and well educated. The automotive industry has grown strongly in recent years and now includes more than 280 companies. The most important export markets are Germany, France, Romania and Italy. The Tunisian government has set itself the goal of promoting the export economy and further improving investment conditions for foreign companies. This includes the protection of intellectual property, the simplification of capital transfers and the reduction of bureaucratic obstacles.

Autoliv Steering Wheels (ASW3) already manufactures steering wheels for export in the governorate of Zaghouan and employs 4,600 people at its plants in El Fahs and Al Nadhour. It is the only manufacturer of steering wheels in Tunisia and is part of the internationally active Autoliv Group. Previously, magnesium armatures were purchased for the production of steering wheels, encased in a plastic foam by Autoliv ASW3 and then covered with leather or another material. Cutting the material to size and sewing it is very labour-intensive. Autoliv ASW3 is now investing in its own foundry. In future, the steering wheel armatures will be produced and further processed at the El Fahs plant. ASW3 expects the integration of this production step to reduce manufacturing and transport costs and would like to operate a standardised quality management system in future. Eliminating unnecessary transport routes will also improve the carbon footprint of the automotive value chain. The steering wheels sold to European customers will be of a higher quality and cheaper than before.

The total investment in the new facilities amounts to 24.57 million euros, including the expansion of the production hall. To make the project a success, the Facility Investing for Employment is providing Autoliv ASW3 with a grant of EUR 4.27 million. The funds will be used to finance the purchase of four machines for the magnesium die-casting of steering wheel armatures.

Production is set to grow to more than 5 million steering wheels per year by 2026. In addition to existing customers Audi, Renault and the companies of the Stellantis Group, new customers are to be acquired. 696 new jobs will be created at the plant in El Fahs, around 550 of which will be for women. Around a third of the new recruits will work in the foundry. The work will be carried out in three shifts. All new employees will have access to the mandatory social benefits in Tunisia, such as pension, health and accident insurance.

The Facility Investing for Employment (IFE) of KfW Development Bank is part of the Special Initiative "Decent Work for a Just Transition" of the German Federal Ministry for Economic Cooperation and Development (BMZ). With its support, the Facility wants to remove barriers that prevent the creation of new and better jobs in the private sector.