Nissan will become the first major automaker to open a production facility in Myanmar, according to reports. The Japanese car maker is the latest international company to announce it will be entering Myanmar, which had been a pariah state.
Back in 2012, Coca-Cola returned to the country after a 60-year absence. General Electric and Caterpillar are also making bids to expand there as the country is climbing out from decades of harsh international sanctions and military rule. A Nissan spokesman said the company will build cars to be sold in the domestic market in the country. Nissan is expected to announce more details about its plans for a factory in Myanmar when executives visit the country on Friday.
Myanmar, which is also known as Burma, has roads that are filled with aging sedans and old buses imported from Japan. Studies show that 40% of the vehicles in the country are more than 20 years old. So Nissan is essentially entering an auto market where new cars are considered to be rare. It is also a market that many consider unique, as right-hand drive cars are driven on the right side of the street. Motorcycles are prohibited in the former capital city of Yangon, but are permitted in other regions of the country.
In April, Ford plans to open a showroom to sell new vehicles in the country. Suzuki, which is based in Japan, also operates in the country producing a limited number of trucks that are offered for sale there.
Decades of oppressive rule have left scars on the state. Even the years of international isolation are visible. In 2007, the former military junta became engaged in a crackdown involving the Saffron Revolution, which was led by the country’s Buddhist monks. Just this past March clashes between the Muslim minority and Buddhists killed dozens of people in the center of the country.
However, during this time the government has freed numerous political prisoners and liberalized economic sectors. Western governments have in return eased sanctions that were originally placed to tighten pressure on the military regime.
Myanmar began taking steps toward democracy two years ago in 2011. Car ownership in the country stands at 2.36 million units, but the population is more than 63 million. Many view those numbers as indicators that the car market has extensive room to grow in the country.
Reports indicate that Nissan is partnering with Tang Chang Motor Holdings Bhd to jointly produce the vehicles. Reports indicate that Myanmar is one of the poorest countries in Asia after decades of isolation from military rule and economic mismanagement.