This project envisages assembly 1000 3-Wheelers per annum. The total investmentrequirement of the project including the working capital is estimated at about Birr 10.6million; of which around Birr 10.2 million is the cost of the working capital while Birr 1million is for machinery and equipments, and another Birr 1 million is for building andconstruction. Based on the cash flow statement, the calculated internal rate of return(IRR) and simple rate of return (SRR) of the project are 32.3 % and 24.6 %, respectively.The net present value (NPV) at 18 % discounting rate is about Birr 3001 thousand. The plant is expected to create employment opportunities for about 26 persons.
2.Product Description and Application
A 3-Wheeler is a motorized vehicle used to transport about four people at a time. Thevehicle is popular in India and other Southeast Asian countries and it is used as a “taxi”.Recently the vehicle has been introduced to the Ethiopian market and it providestransport services in Dire Daw, Harar, Awassa, Bahir Dar and in other urban centers
3.Market Study, Plant Capacity and ProductionProgram
3.1.1Present Demand and Supply
Although it increases instability, having one wheel in front and two in the rear for power reduces the cost of the steering mechanism and fuel consumption significantly. In urbantransport market segmentation, a 3 – wheeler is equivalent to a taxi. However, it is better taxi because it is less expensive and less fuel consuming. With the current sky rocketing price of petroleum substituting taxis with three wheelers (to the possible extent) is not anoption; rather it is a must.Since they are introduced to the Ethiopian market, a clear demand pattern for the threewheelers has been emerged. As it is mentioned above, they are providing transport3