Chinese Auto Supplier Kuntai to Invest $13.7 Million in Moroccan Factory

Marrakech – Chinese automotive interior materials manufacturer Kuntai has announced plans to establish a production facility in Morocco through its subsidiary Kuntai Hongjing Co Ltd.

The project represents a total investment of 100 million RMB (approximately $13.7 million or MAD 126.5 million) and will focus on manufacturing car floor mats and carpets for vehicles.

The new Moroccan facility will integrate research and development, production, and sales operations for automotive floor mats.

The company will also develop a service network in Europe to meet regional customer needs. This strategic move aims to strengthen Kuntai’s international development strategy and reinforce its presence in the European market.

The project will be implemented in phases, with deployment depending on market evolution and operational progress. It will be financed through the company’s own funds without significant debt.

The Moroccan factory follows Kuntai’s international expansion roadmap, which already includes a production site in Mexico established in 2024 that serves the North American market.

Kuntai specializes in tufted and non-woven carpets for the automotive industry. The company supplies Chinese manufacturers like BYD, Xiaomi Auto, Li Auto, and NIO, as well as European (Audi, Volvo, Land Rover, BMW), Japanese (Toyota, Honda, Mazda, Nissan), and American (General Motors, Tesla) automakers.

Its product range includes floor mats, wheel covers, spare wheel covers, engine protection plates, and seat back covers.

In the first quarter of 2025, Kuntai recorded revenue of $178.6 million and a net profit of $900,000. The Moroccan investment represents less than one quarter of its revenue but constitutes a strategic development axis targeting the European market.

Morocco’s geographic proximity to European markets like France and Spain, combined with free trade agreements with the European Union, provides far-reaching advantages.

Products exported from Morocco benefit from duty-free access, which Kuntai notes “significantly reduces arrival costs and neutralizes the effects of anti-dumping measures.”

Maritime transport from Morocco reduces shipping distance to Europe by 80% compared to exports from China and cuts logistics costs by more than 60%, according to internal data cited in the company’s announcement.

Additionally, Morocco’s lower labor costs compared to European countries contribute to product competitiveness, while the local regulatory framework offers incentives for foreign investors.

According to Kuntai’s 2024 annual report, international sales represented only 10.95% of revenue, with the Chinese domestic market accounting for 89.05%.

The Moroccan facility will help rebalance production between China, Mexico, and Morocco, with each covering a major geographic region of the automotive market.

The global automotive carpet market is valued between $166 billion and $189 billion. North America represents approximately $41 billion of this market, while Europe accounts for about $24 billion. Kuntai aims to capture a share of these markets through its two new factories.

The company also reports expected profitability improvements, stating that the export gross margin rate reaches 35.05%, compared to 25.55% in the domestic market.

Kuntai anticipates that Moroccan production will significantly improve the group’s overall profitability while enhancing delivery times and product diversity.