Neptune Holding planning Cameroon’s first tyre factory

Neptune Holding Company, a Cameroonian owned enterprise, is leading a bid to build the country’s first tyre factory in Bomono, near the city of Douala. The Cameroon Tires Factory (CTF) project, as it is known, expects to create 2000 and 2500 direct jobs plus as many as 5000 indirect jobs and is being planned in conjunction with Black Donuts.

The project aims to produce 4.6 million tyres a year initially. Broken down by product segment, that means 4 million car tyres and 600,000 truck tyres. Investment associated with the project has been pegged at around 400 billion Central African Francs (£531 million; $649 billion; 612 billion euros), which sounds high given the proposed tyre output figures.

The new factory will make car and truck tyres. Tyres produced at CTF will be branded “Afri Star. The factory aims to get into production by 2025, with construction work set to begin in October.

Neptune Holding reportedly received an audience with Cameroon’s Minister of Commerce along with representatives from Black Donuts back in April. The general director of CTF, Antoine Ndzengue, who is also the Neptune Holding outlined the project

Cameroon’s first tyre factory is being built in Bomono, near the city of Douala in the west of the country (Photo: Terrametrics; Google Maps)

“It is a great pride for us to know that the Cameroon Tires Factory will help the CDC to relaunch its production. This will allow us to implement import-substitution. The government will spare no effort to help you secure this market”, Cameroon government Minister Luc Magloire Mbarga Atangana told local publication Invest Time, adding, “…the Zlecaf [African Continental Free Trade Zone], it is very important. Our commitment is to produce good quality products. Your partnership with the CDC as part of this project opens new doors for it”.

Structure Finance Group (SFG), a subsidiary of Société Générale, is syndicating financing for the project, in which the Development Bank of Central African States (Bdeac) is participating along with Ecobank Cameroun, Afriland First Bank, Bgfi Bank Cameroun and Bank Atlantique Cameroun.

In the two years between the start of the project and production in 2025, CTF will market Double Star tyres. There has been no indication as to whether or not the Chinese tyremaker is involved in the Cameroon tyre factory project.

As well as rebalancing domestic demand by operating “import-substitution”, having a factory in Cameroon is also designed to undermine the local second-hand tyre market, which has reportedly been proliferating despite higher taxes than new tyre imports.

As far as location is concerned, Bomono is located in the vicinity of Cameroon Development Company (CDC) oil palm and rubber plantations, putting the tyre factory nearby natural rubber supplies.

“The CDC is still suffering from the Covid-19 period, the Russian-Ukrainian crisis, the drop in world prices for raw materials, as well as the climate of insecurity in English-speaking areas. The arrival of the CTF will give a boost to the activities of the CDC,” CDC chief executive Franklin Ngoni Njié told Invest Time.

In 2020, Cameroon produced 60,000 tons of rubber compared to 45,000 tons in 2019, an increase of 15,000 tons.