Challenges of locally Assembled vehicle supply Chains in Ethiopia: Assemblers Perspective
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Date
2017-06
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Addis Ababa University
Abstract
This study was carried out on challenges of locally assembled vehicle supply chains in Ethiopia from assembler’s perspective with regard to technological, cost, infrastructural, market or service, relationship, production or skills challenges. The main objective of the study was to describe the supply chain challenges faced from the perspective of the assemblers and identify measures taken to overcome the challenging factors. The study raised three research questions that are answered as a result of the study. The target population covers all local vehicle assembling firms in Ethiopia. For the study descriptive type of research design was used, and quantitative and qualitative data was collected to collect information on challenges of the firms and measures taken to overcome the challenges from the respondents. Descriptive statistics was employed for the analysis of the data by using SPSS v 17 software and different secondary documents analysis is done for confirming the findings The result indicates technological and infrastructural challenges followed by cost challenges are found to be critical for the vehicle assembling firms in Ethiopia. In addition to this complicated LC opening procedures, the difference between bonded warehouse and customs working strategy, second hand imported vehicles, government policies and tax issues, the chance given by the government to investors to import cars without any tax due which affect the sales of locally assembled cars are also quoted by respondents as challenges. Even though measures have been taken by the assemblers to reduce challenges by using a systematic way of handling their customers, training their employees, using inbound logistics systems and discussing with concerned government officials the shortcomings cannot be reduced. This indicates most of the challenges are beyond the control of the firms, and need coordination between all the stakeholders for reducing the impact of these challenges for the growth of the industry
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Keywords
Supply chain challenges, Ethiopia, Vehicle assembling firms