Kénitra, Morocco – A surge in Chinese investment is reshaping Morocco’s automotive industry, attracting a significant portion of Chinese automotive supply chain projects earmarked for the Middle East and North Africa (MENA) region. According to a recent report by BMI Fitch Solutions, Morocco has secured 23 out of 45 identified projects from Chinese equipment manufacturers and automakers between 2023 and 2025, outpacing Egypt and Algeria.
The most prominent investment is from Gotion High Tech, which is constructing a gigafactory in Kénitra with a planned final investment of 65 billion Moroccan dirhams. Simultaneously, CNGR Advanced Materials is developing a production facility in Jorf Lasfar for battery components – anodes and cathodes – slated to begin operations by the conclude of 2026.
This industrial push is strategically designed to circumvent trade barriers. Chinese electric vehicles currently face tariffs as high as 100% in the United States and 45% in the European Union. By manufacturing in Morocco, Beijing aims to leverage Rabat’s existing free trade agreements with Washington and Brussels to access Western markets, mirroring a strategy previously employed in Mexico.
To qualify for these preferential trade terms, companies must adhere to the Pan-Euro-Mediterranean (PEM) convention, which stipulates that non-zone components should not exceed 45% of a vehicle’s value. Morocco’s skilled workforce and world-class infrastructure, including the Tanger Med port, are crucial for facilitating these exports to Europe.
A key advantage for Morocco lies in its natural resources, particularly its possession of 70% of the world’s phosphate reserves. This mineral is essential for the production of Lithium Iron Phosphate (LFP) batteries, a lower-cost technology where China currently holds a leading position. Experts predict that Morocco will become a global production hub for LFP batteries by the mid-2030s.
The influx of Chinese investment is occurring alongside significant expansion by established automakers. Stellantis, formerly Groupe PSA, opened its Kénitra plant in 2019 and is investing 1.2 billion euros to increase production capacity to 535,000 vehicles annually by 2030. The plant currently produces models including the Peugeot 208, Citroën Ami, and Fiat Topolino. As of 2023, Stellantis produced approximately 190,000 vehicles in Morocco, with plans to reach 535,000 by 2030, including 400,000 segment B vehicles and 135,000 small urban vehicles. The facility will also produce 350,000 engines and 200,000 charging stations.
Renault is also expanding its presence, aiming for a production capacity of 500,000 vehicles in Morocco by 2025, operating from its Tanger and Casablanca plants. Combined, Renault and Stellantis are driving a substantial increase in Morocco’s automotive output, with projections exceeding one million vehicles annually by the end of the decade, up from approximately 600,000 units in 2024.
In response to this development, the European Union is attempting to counter the trend through its “Green Partnership” and record funding from the European Investment Bank, totaling 740 million euros in 2025. Still, researcher Ahmed Aboudouh suggests that reversing the momentum may prove difficult, given the immediate and substantial economic benefits the Chinese presence offers Morocco.
