AUTOMOTIVE INDUSTRY

“Colombia meets all the right conditions to be an significant player in vehicle production worldwide, and the country could have a solid and e cient automotive industry that generates high-quality jobs.”

Juan Manuel Santos,PRESIDENT OF THE REPUBLIC OF COLOMBIA

PRODUCTION AND MARKET COMPOSITION

Colombia is the fourth greatest producer of vehicles in Latin America, with more than 130,000 units assembled per year. Acolfa, 2015.

Colombia has a wide network of manufacturers and distributors of parts for cars and motorcycles with capacity to serve foreign markets.

Colombia can boast the presence of recognized assemblers such as: Renault, General Motors, Hero, Toyota-Hino, Susuki.

Colombia is the second largest producer of motorcycles in the region after Brazil with more than 660 thousands units. Acolfa, 2015

L ibe rtad y Or den

INCREASE IN DEMANDAND SALES IN THE SECTOR

SALES OF VEHICLES IN COLOMBIA PRODUCTION OF MOTORCYCLES IN COLOMBIAThousands of units Thousands of units

Source: ANDI and Business Monitor Internationale = estimated

Sofasa-Renault and General Motors Colmotores are the assembly plants with the greatest volume of production and vehicle sales in the local market. In commercial cargo vehicles the leader in production and sales is Hino.

Motorcycle production almost doubled between 2010 and 2014, recording an average annual growth of 16%. Produc

-tion of motorcycles represented on average around 94% of apparent consumption, while imports were 6%.

Between 2015 and 2019, vehicle sales are expected to grow at an average rate of 5.8%, thus sales will exceed 430,000 units. Business Monitor, 2015

66% of vehicles sold in Colombia are imported and 34% are assembled. ANDI, 2016

2010

253,9

324,6 316,0 293,8328,5 350,9 362,8 381.0 398,7 436,0

2011 2012 2013 2014 2015e 2016e 2017e 2018e 2019eSource: Acolfa and Business Monitor Internationale = estimated

2010

390,3516,7 553,6 625,1 662,6 672,6 678,6 685,4 687,5

2011 2012 2013 2014 2015e 2016e 2017e 2018e

Between 2013 and 2015, vehicle sales exceed 300,000 units on average. ANDI, 2016.

Cars, SUVs, pickup trucks and cargo vehicles, are the best-selling segments in the country. ANDI, 2016.

in Colombia, mainly in the Pacific region, will permit organizing the productive chain to achieve logistic and scaling advantages for exporting vehicles and auto parts.

PROJECTS THAT IMPACTTHE AUTOMOTIVE INDUSTRY

COLOMBIA AS A VEHICLE EXPORT PLATFORM

Colombian vehicle exports are mainly cargo vehicles and automobiles to Latin American countries such as Mexico, Ecuador, Chile and Peru. DANE, 2016

As a result of the free trade agreements Colombia has achieved

of commercial passenger and cargo vehicles, utility vehicles and motorcycles, to countries such as Mexico, Peru and Chile.

agreements, the development of the manufacturing industry and the road infrastructure projects that the Colombian Government is implementing, will encourage demand for freight vehicles, since 73% of cargo is mobilized by land.

182,885 to 360,879 vehicles. Cargo transportation is comprised of 73% trucks. Colfecar, 2015

country will mean an increase in demand for commercial passenger vehicles.

In 2014, the number of traditional transport vehicles in service decreased by 13%, while those belonging to the integrated transport systems increased by 46%. It is expected that by 2020

Vehicle exports registered a compound annual growth rate of 15% between 2010 and 2015. DANE, 2016.

Motorcycle exports registered a compound annual growth rate of 22% between 2010 and 2015. Ecuador and Vene-zuela are the main export destinations. DANE, 2016.

AUTO PARTS MARKET UNDER DEVELOPMENT AND WIDE RANGE OF PROVIDERS OFORIGINAL AND SPARE PARTS

OTHER FACTORS FORINVESTING IN THE SECTOR

COLOMBIAN EXPORTS OF AUTO PARTS 2010-2014, USD MILLIONS

NUMBER OF GRADUATES IN AREAS RELATED TO THE AUTOMOTIVE INDUSTRY 2010-2014

corresponds to graduates in Mechanical Engineering, Industrial Engineering, Electronic Engineering and related fields.

Source: Productive Transformation Program.

Production in the auto part sector doubled over ten years, going from USD 414 million in 2002 to USD 945 million in 2012, recording an average annual growth rate of 10%.

close to the automobile assembly plants, in Cundinamarca, Valle del Cauca y Antioquia.

positions, and are mainly car batteries, tires and security windows. Ecuador, Venezuela, United States, Mexico and Peru are the main destinations for exports of autoparts.

Skilled labor: the annual average of graduates in areas related to the sector is around 30,000. Labor Observatory, 2015

in the region with USD 2.41. IMD- World Competitiveness Yearbook 2015

20142013201220112010

449,7

491,4454,0

367,3327,7

20142013201220112010

18.23526.337

30.398

33.580 33.345

Colombia o�ers the following incentives and programs that bene�t the automotive industry: (1) Automotive Industry Promotion Program (PROFIA); (2) Assembly System for the automotive industry within the Andean Commu-nity agreement; (3) Deposits enabled for processing and / or assembly (DHTE); (4) Free Zones for assembling process; (5) Production and assembly of vehicles or equipment environmentally friendly; (6) Automotive agreement between Colombia and Brazil.

Bogota is the main center for the industry, with 5 of the 8 assembly plants in the country.

Bogota accounts for 37% of all new vehicles registered in the country.

the auto parts industry of the country.Source: Invest in Bogota

Source: Inves

Opportunities for assembling buses, trucks, light vehicles and motorcycles.

aims to increase innovation, productivity and competitiveness of the auto parts industry and vehicles of Colombia.Opportunity to manufacture auto parts: the region of Valle del Cauca is a leading manufacturer of electric batteries, tires and other rubber products.

Opportunities for assembling buses, trucks and light vehicles.Regime for competitive incentives: automotive companies to take advantage of the growing domestic market and the possibilities for

production of machinery and transport equipment.Opportunities in manufacturing parts

Opportunities for assembling buses, trucks and light vehicles.

Port of entrance for CKD material coming from Europe and North America.gion.

n projects.Source: ProBarranquilla

COLOMBIA, A COUNTRY WITH MULTIPLE DEVELOPMENT HUBS

VALLE DEL CAUCA

CULTURAL COFFEE LANDSCAPE:

CARIBBEAN:

CUNDINAMARCA

Four

LARGE FOREIGN COMPANIES HAVE CHOSENCOLOMBIA AS A PLACE TO INVEST

General Motors-Colmotores. Hero. Baterías MAC y Jhonson Controls.

invested USD 200 million in its industrial Free Trade Zone to construct a stamping/ cutting and folding plant.

production in the region of Valle de Cauca has established a Joint Venture with the U.S. company Johnson Controls, the main producer of batteries worldwide.

in the manufacture of motorcycles, built a production plant in order to become a distribution platform to Central and South America because of the suitable logistical conditions.