? Gov’t revs up EV push: The government is ramping up efforts to put Egypt on the EV assembly map by offering unconventional incentives and courting top international producers of batteries and auto components. This is being done through coordination among several ministries and agencies, under the supervision of Prime Minister Moustafa Madbouly. Additionally, the government is working towards limiting the import of Chinese EVs to authorized dealers, potentially accelerating localisation plans.

Egypt is ready to offer "out-of-the-box” incentives to fast-track international investment in the EV industry, Madbouly said in a high-level meeting in New Alamein last week. Since batteries account for around 50% of an EV’s cost, localizing battery production is a cornerstone of the roadmap, head of the Suez Canal Economic Zone Walid Gamal El Din noted during the meeting. Talks are already underway with leading battery manufacturers, and all relevant ministries will be involved in the process.

Several local players have announced plans to manufacture EV batteries, including Ezz Elsewedy Investment Company — a joint venture between Elsewedy Capital and automotive group Ezz El Arab — which has earmarked USD 100 mn for EV and traditional auto assembly and component manufacturing in Egypt. Local firm Al Safy Group also plans to manufacture EV and mobile phone batteries.

Investment in the EV industry won’t happen without a strong local market, El Saba Automotive Chairman and member of the Federation of Egyptian Chambers of Commerce’s auto division Alaa El Sabaa told EnterpriseAM, adding that “no company will build an EV or battery plant just to supply 20k units.” Sabaa said the government must commit to purchasing EVs for public fleets to ensure baseline demand — a prerequisite before talking exports or attracting foreign investors.

In numbers: Total car sales surged by 104.7% y-o-y in June, up from 8k units the previous year. Passenger car sales jumped 95.9%, truck sales 194%, and bus sales 61.7% Y-OY, according to figures from the Automotive Marketing Information Council (Amic), which represents the bulk — but not the entirety — of the industry.

Localization needs creative incentives. Egypt will need extraordinary financial and legislative incentives to offset the customs exemptions imported EVs enjoy, Sabaa told us. He suggested indirect incentives like income or social insurance tax breaks for manufacturers and buyers — or off-budget financing initiatives — to spur local production.

Egypt still has a shot at the EV race if it moves quickly on incentives — and realistically benchmarks against markets like Morocco and China, Sabaa said. Sabaa also emphasized that the country must identify a clear competitive edge to draw in industry players.

The gov’t is all fired up: The Finance Ministry is prepared to allocate financial and tax incentives, according to each investor’s needs, offering unprecedented flexibility in negotiations, Finance Minister Ahmed Kouchouk said during the meeting. Three programs with incentives to support local production of trucks, light transport vehicles, minibuses, and electric taxis, are also in the works, with a financing of EGP 9.2 bn during the current fiscal year.

Negotiations are also underway to grant bus and truck manufacturers the same privileges as passenger car manufacturers, with an additional separate program prepared to attract investment and encourage a shift to local manufacturing, Khaled Saad, head of the Automotive Manufacturers Association, told EnterpriseAM.

We already have a solid manufacturing base: Egypt has strong capabilities in component manufacturing — like wiring harnesses, lighting, seats, and automotive glass — which are already exported to Europe, according to Deputy PM and Transport and Industry Minister Kamel El Wazir.

Big players are still skeptical. The government wants to lure battery manufacturers as a gateway to EV localization, offering customs breaks, land allocation, and logistics support in industrial zones. But many major players are still holding back until there’s more clarity on implementation mechanisms and how local partners will be chosen, a senior auto executive told EnterpriseAM.

The EV push is not just about meeting local demand. The roadmap includes plans to export to the Gulf, Africa, and Europe in the medium term. Egypt is negotiating export agreements alongside talks with automakers, with its eyes set on becoming a regional EV export hub, a government source told EnterpriseAM.

The clock is ticking. Turning plans into reality within 18-24 months is the biggest challenge. Time is critical, and Egypt is up against competition from Morocco, South Africa, and the UAE. Delays risk Egypt falling behind, an independent industry expert told EnterpriseAM.

Even the state wants in. SN Automotive — the joint venture between Al Safy Group and state-owned El Nasr Automotive — launched 9 Chinese EV models last week in collaboration with Dongfeng Motor. The Chinese giant views Egypt as a strategic market, and wants to utilize the country as a regional base for manufacturing and distributing spare parts in Africa, Dongfeng’s Africa head Liao Chengli said at the launch event, attended by EnterpriseAM.

Local assembly is reshaping Egypt’s broader auto market. A wave of new auto plants has changed the market in 2025. Local vehicle assembly capacity has jumped to around 120k units annually, easing supply shortages and prompting price cuts of more than 20% in some car segments. The expansion has reduced import dependence, eased FX pressures, and helped stabilize the EGP — boosting consumer confidence in local products. With more brands and models assembled in Egypt, consumers now have a wider range of competitively priced choices, solidifying local manufacturing as a key driver of market balance and sustainable growth.

Prices are expected to continue falling. A surge in supply — from both local assembly and imports — has already driven prices down and tighter competition and thinner margins across the supply chain are likely to push prices lower still. Consumers today can choose from dozens of models, a far cry from the limited options of just two years ago, Sabaa said.