Rechi, a Taiwanese Manufacturer, Partners With El-Araby Group to Build a $33M AC Factory in Egypt

Rechi, a Taiwanese Manufacturer, Partners With El-Araby Group to Build a $33M AC Factory in Egypt

Rechi, a Taiwanese manufacturer, is partnering with El-Araby Group, an Egyptian-based home appliances dealer, to build a $33 million air-conditioning compressor factory with a production capacity of 6 million compressors annually, with operations expected to begin in 2024, according to a statement from Egypt’s Ministry of Trade and Industry.

Ahmed Samir, Egypt’s Minister of Trade and Industry remarked that the new project will be built on an area of 60,000 square meters in the industrial zone of Kom Abu Radi in Beni Suef, with an initial production volume of 2 million units expected to increase to 6 million units within five years.

Samir explained that the project’s goal is to meet the needs of the local market while exporting 50% of production to regional and international markets by leveraging preferential advantages provided by free trade agreements signed between Egypt and a large number of countries and major economic blocs around the world.

He also stated that the Rechi factory will produce an air-conditioning compressor with a capacity of 1.5-3 horsepower and that the proportion of local components in the final product will start at 50% and gradually increases.

Samir also emphasized the ministry’s desire to attract international industrial companies to invest in the Egyptian market and contribute to the establishment of technological industries while relying on local raw materials and natural resources.

What the Project Stakeholders are saying

Chen Sheng Tian, Chairperson of Rechi stated that the company is eager to invest and expand in the Egyptian market because it is one of the most important investment destinations in the Middle East with many advantages such as free access to products through free trade agreements and low shipping costs. He also mentioned the possibility of benefiting from the Suez Canal, which is one of the world’s main shipping lanes.

He went on to say that the parent company produces approximately 20 million air-conditioning compressor units per year and is ranked fourth among global compressor producers.

According to Mohamed Mahmoud Al-Araby, CEO of Al-Araby Group, negotiations with Ritchie are currently underway to establish some projects in the Egyptian market producing refrigerators and air conditioners.

He also stated that Al-Araby Group will soon open a new factory specializing in tin anatomy, which is one of the group’s primary production inputs for its home appliance industries.

This adds to the growing number of multinationals expanding into the Egyptian market in recent times, which is a testament to the effectiveness of the government’s strategic policies. You will recall that we reported early this month that OPPO, a leading Chinese mobile phone manufacturer signed a Memorandum of Understanding with the Egyptian Information Technology Industry Development Agency (ITIDA) to establish a $20 million mobile phone plant in the North African country.