FRANKFURT (Bloomberg) -- Volkswagen Group has resumed building vehicles in Nigeria for the first time in 25 years in a bid to foster sales growth in Africa.
Assembly began Tuesday in Lagos of models that will include the Passat, Jetta and CC sedans as well as the Amarok pickup truck, Stallion Group, VW's manufacturing partner, said in a statement.
VW confirmed the start of production without specifying planned volumes.
Nigeria is Africa’s most populous nation with about 170 million people and has the continent's largest economy. The country is emerging as a key growth driver for the entire continent.
Global automakers have been expanding manufacturing outside traditional car markets to benefit from tax breaks and avoid import duties. Additional sales in those countries would also cushion the effects of slowing growth in China and contractions in Brazil and Russia.
French peer PSA/Peugeot-Citroen announced plans last month for its first direct investment in Africa with an assembly plant in Morocco. The automaker also builds the Peugeot 301 sedan in Nigeria in small volumes at a plant operated by PAN Nigeria.
VW started producing its iconic Beetle in Lagos in 1975 through a partnership and later added other cars and light commercial vehicles before ceasing the operations in 1990 amid weak demand and quality woes. Dubai-based Stallion, which is the official distributor of the German carmaker's VW, Audi, Skoda and Porsche brands in Nigeria, acquired the Lagos plant at the time.
Stallion also assembles vehicles in Nigeria for Nissan Motor Co., Hyundai Motor Co., Ashok Leyland Ltd. and CNH Industrial NV's Iveco truck division.
VW's other manufacturing facilities on the continent are located in South Africa. They comprise a factory that produces the Polo subcompact, and three truck or bus plants for the Scania and MAN brands.
Automotive News Europe contributed to this report