Eng. Amer Al-Jayyousi

Can Jordan manufacture vehicles that compete on cost , quality and compete overseas?

With current government incentives, an established base of component manufacturers, international trade agreements and investors experienced in both manufacturing and distribution, I believe there are sound economic reasons to take this possibility seriously.

The Cabinet’s incentives for automotive manufacturing and assembly in the Zarqa Development Zone strengthen the investment case. For full assembly or manufacturing projects, a 70% electricity subsidy for five years and a 60% reduction in land prices address s
ignificant operating and establishment costs. They also give investors greater scope to commit capital to machinery, technology and production capacity.

The value of these incentives depends on the expertise of those putting them to work. The investors pursuing automotive manufacturing in Jordan bring industrial experience and relationships with international brands. They have also established leading positions in the Kingdom’s vehicle trading, import and export markets. Their understanding of demand, distribution and customer expectations can help ensure that production decisions are commercially grounded.

This is why I am confident that the factory project being developed in Jordan can succeed. Its investors understand manufacturing and quality control alongside market selection, exports, and after-sales support. Together, these capabilities help determine which models to produce, which technologies to adopt and how to manage costs while building a sustainable customer base.

Regional experience offers practical lessons. Morocco has brought vehicle manufacturers and component suppliers together, supported by industrial land and specialised training. Its annual production capacity now exceeds one million vehi
cles. Egypt’s automotive programme adds another useful approach: linking incentives to manufacturers’ performance, local content, production volumes and exports. For Jordan, these experiences demonstrate the importance of developing suppliers while ensuring that public support produces measurable industrial gains.

Jordan already has capabilities on which to build. Locally manufactured radiators and cooling systems reach markets in Europe, North America, Asia and Africa. Connecting these producers with new vehicle manufacturing investments could generate supply contracts that justify additional machinery, higher output and product development. A larger production base would also strengthen their ability to pursue export opportunities independently.

The requirement for full assembly projects to establish or attract at least three supporting operations to qualify for income tax exemption encourages precisely these connections. As local procurement grows, the benefits spread to smaller businesses, engineering services, transport and maintenance providers. More of the value generated by the investment remains in Jordan, supporting employment and further industrial development.

Exports must be central to the business model from the outset. Larger production runs spread fixed costs across more vehicles, improving unit economics. Jordan’s agreements with the United States, the European Union and other trading partners offer opportunities to reach wider markets. Realising those opportunities requir
es compliance with rules of origin, product standards and market access requirements, backed by credible marketing plans and sales agreements.

Production could begin with one or more models selected for demonstrated demand, then expand as sales and local sourcing increase. A successful operation would attract additional suppliers and manufacturers, supporting Jordan’s emergence as a regional centre for vehicles and automotive components. Training technicians, engineers and quality specialists would ensure that Jordanians participate directly in this growth while building skills that attract further investment.

For this process to gain momentum, investors need efficient procedures, predictable policies and coordination across public institutions. The economic return should be assessed through local wages, procurement and services, alongside export earnings retained after paying for imported inputs. These measures provide a meaningful basis for evaluating incentives and directing them towards productive investment.
Jordan has a credible opportunity to establish an automotive industry. A successful factory would demonstrate the commercial potential of manufacturing in the Kingdom and encourage others to invest. With experienced investors and effective implementation, Jordan can turn its accumulated expertise in the vehicle trade into a stronger manufacturing and export base.


* Eng. Amer Jayyousi- Vice Chairman of the Jordan Free Zones Investors Commission