The plant in Adama city, also known as Nazret, in central Ethiopia assembles FAW's small vehicles from semi-knockdown kits imported from China, FAW Xiali said in a statement.

The factory, FAW Xiali's first assembly plant outside China, opened in December and can build as many as 2,000 vehicles a year. The plant's first product will be the Xiali N5 subcompact, according to the company.

FAW Xiali produces small cars under its Xiali and Weizhi brands.

In the first 11 months of 2011, the company's sales declined 4 percent year-on-year to 235,939 units, according to LMC Automotive.

Great Wall Motor Co., Lifan Industry (Group) Co. and Zhejiang Geely Holding Group Co. also operate assembly plants in Ethiopia, the second-most-populous country in Africa.