Financial services provider Absa has entered into a vehicle finance alliance agreement with local subsidiary of the Beijing Automotive Group, BAIC South Africa (BAIC SA), as the vehicle manufacturing firm expands its operations in South Africa.
Absa will partner with the automotive manufacturer to offer comprehensive financing options to help fuel BAIC SA’s growth and offer attractive credit solutions to customers.
BAIC SA launched in South Africa in 2016 and it has invested in a manufacturing and assembly plant in the Coega Industrial Development Zone, near Gqeberha, in the Eastern Cape.
At the time of the investment, BAIC SA said it represented a significant foreign direct investment by an automotive company in South Africa, and that it was expected to create as many as 13 000 direct and indirect jobs.
For Absa, the alliance represents an opportunity to boost its share of financed vehicles sold in South Africa as the popularity of affordable luxury brands continues to grow among South Africans.
BAIC’s luxury category Beijing X55, launched locally on November 15, 2022, is a finalist in the South African Guild of Mobility Journalists’ 2023 Car of the Year award.
The launch of its vehicle models, together with a dealer network of 29, has laid a foundation for BAIC SA’s expansion.
“We are honoured to partner with an automotive player that has invested in the growth of our continent, aligned with our values as a purpose-led pan-African bank,” says Absa vehicle and asset finance managing executive Charl Potgieter.
“We look forward to leveraging off each other’s strengths to drive greater competition in the market and deliver better value for our customers.
“There is an increase in the sale of China’s automotive brands in our market and this is also the case with BAIC-manufactured vehicles, as it prepares to take on competitors locally.
“The South African consumer has come to appreciate the growing trend in affordable luxury branded vehicles and expects more ‘bang for their buck’ when buying a new or used vehicle during these tough economic times and this alliance answers the call from the South African consumer on many levels,” he says.
With three models available locally, BAIC SA has many opportunities to diversify its offering throughout the value chain.
Groupwide, Absa is committed to offering BAIC various services that will enable each entity to reach its growth ambitions.