Ambitious plans

The group aims to assemble 10,000 cars and trucks and help develop the North African country’s industrial infrastructure. The project is being financed by Aabar Investments, a state-backed company from Abu Dhabi. The value of the deal was not disclosed.

German manufacturers Deutz, MTU Aero Engines and Rheinmetall will contribute licenses and intellectual property to the venture, according to a statement released this week by Aabar.

Daimler spokesperson Brigitte Bertram told Deutsche Welle that construction of the Algerian factories is expected to start in 2010, and that Daimler would provide parts for the vehicles assembled there.

Recent years have seen Algeria struggle to attract foreign investment. In the 1990s it was plagued by civil war, and authorities say radical Islamic militants are still active in the eastern part of the country. Still, MAN Ferrostaal says it has worked in Algeria before without incident and is committed to the new project.

MAN Ferrostaal spokesman Daniel Reinhardt said that once the German companies build the factories and get them running, Algerians are to fill the jobs.

''Algeria has an interest to build up its factories and employ its people,'' Reinhardt told Deutsche Welle. ''The intention of this project is to help them do so.''

According to Aabar, the factories are most likely to produce utility vehicles such as the Mercedes-Benz G-Class four-wheel drive, Unimog trucks and Sprinter vans.

Aabar Investment is a subsidiary of International Petroleum Investment Company (IPIC), which the Abu Dhabi government uses to manage the emirate's oil wealth. Abu Dhabi is looking to diversify its investments in non-energy related sectors. In March Aabar bought a 9.1 percent stake in Daimler, making it the largest shareholder in the Stuttgart-based company. Meanwhile, IPIC owns 70 percent of MAN Ferrostaal.

Author: Chad Smith

Editor: Sam Edmonds