COMPANY PROFILE
2013
WBHO/FAW SA
The locally built FAW Coega assembly plant
company report
The locally built FAW Coega assembly plant Editorial – Roland Douglas Production – Hal Hutchison
Local construction firm WBHO are currently building a new assembly plant for Chinese auto-manufacturer FAW. The factory will cover over 400,000m² and create hundreds of jobs, we find out more about the progress so far…
Brazil, Russia, India, China and South Africa (BRICS) are now working closer than ever before following the fifth BRICS summit which was held in Durban in March. Proof of these relationships was seen in March 2012 when major Chinese automotive company, FAW (First Automobile Works) broke ground on their R600 million truck and passenger car plant located at the Coega Industrial Development Zone (IDZ) in the Eastern Cape. Local construction firm, WBHO, have been named as the company who are building the immense factory and the business, who strive to be the best construction company in southern Africa, have made a lot of progress since starting out, just over a year ago.
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The Coega Development Corporation (CDC) is the organisation responsible for developing the IDZ and CDC marketing and communications manager, Ayanda Vilakazi last year said: “Coega welcomes the appointment of WBHO Construction as this reconfirms that FAW is here to stay. This is big news for the Eastern Cape‚ but particularly Nelson Mandela Bay because of the huge economic spinoffs for the city. “Moreover it emphasizes the fact that a number of BRIC countries‚ China and India in particular‚ are watching South Africa with interest and are not afraid to match intention with investment.” WBHO have a portfolio of successful large scale builds including some of the country’s iconic sports stadiums, shopping malls and airports.
WBHO/FAW SA
“Southern Africa is seen as the gateway to Africa and I think this is the first instance where Chinese investment in the region has a concrete dimension to it in terms of spend and operation dynamics”
Speaking about winning the contract, WBHO Construction Eastern Cape MD, Arnie van Jaarsveldt, said: “It was not easy and as always the budget was tight. The negotiations were intense and arduous but in the end a fair deal was struck between the two parties. “It was a joint effort and all the design, construction work and specialist sub-contractor trades and work will be carried out by local companies. “WBHO Construction and their consortium – Uhambiso Consulting Engineers, Studio d’Arc Architects, RPE Quantity Surveyors together with their team of specialist sub-contractors – are very pleased and excited to have won this design and construct bid and look forward to a very successful
relationship with FAW and their consulting engineers MMI, together with the CDC.” The factory’s first phase of construction is scheduled for completion in December this year and will be the latest in a string of investments from multi-national automotive companies. General Motors and Volkswagen both have facilities on or near the Coega IDZ and the location is preferable because of its proximity to the purpose-built deep-water Ngqhurha Port and automotive hub of Port Elizabeth. FAW SA, the regional division of the Chinese corporation, is extremely excited about progress at the site and national marketing manager, Leon du Plessis tells IndustrySA that the plant will serve the local market and act as a gateway to the rest of the continent.
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company report “The factory will serve the domestic market which we are very pleased about. There is also the possibility of serving the African markets, definitely sub-Sahara, very effectively. “The location of the factory was a primary consideration. Port Elizabeth was called the ‘Detroit of Africa’ so reinvestment and redevelopment of an area which is in need is a real positive thing. “Southern Africa is seen as the gateway to Africa and I think this is the first instance where Chinese investment in the region has a concrete dimension to it in terms of spend and operation dynamics.” While this plant will be state-of-the-art and home to fantastic technology, it is not the first African adventure for FAW. “We do already have a presence on the continent,” says Mr du Plessis. “The first foreign assembly plant for FAW trucks opened in Tanzania in 1970. Africa has never been ignored but just not looked at in the same way until quite recently.”
Mr du Plessis was also keen to point out the size of the build stating: “It’s a huge plant, around 440,000m².” The FAW factory will be located in Zone 2 of the Coega IDZ and it is reported that 500 jobs will be created at the plant in the early stages with more to come as production levels increase. This news is welcomed by the region which is now seeing substantial reinvestment from the automotive sector and FAW SA hope that the region will see further investment and more companies opening up in the region. “There is a sense of social responsibility, on a decision side, which is commendable. It shows that we are doing something, taking the lead, and hoping that others will follow suit and that the economy will get a boost,” says Mr du Plessis. “We are hoping there will be a significant renewed presence down there; it will only be advantageous for us and the whole economy.”
A FORTUNE-500 COMPANY The FAW Group is headquartered in Changchun, Jilin, China. It is one of the world’s leading automotive companies and because of this, the announcement to invest heavily in South Africa was met with celebration by officials in the Eastern Cape with Premier, Noxolo Kiviet, on site alongside FAW Chairman Jin Yi at the groundbreaking ceremony for the new facility. FAW is known for manufacturing quality trucks to suit the light, medium and heavy market segments. The company also makes buses, passenger cars, SUVs, pickups, components and parts. Mr du Plessis explains more about the history of FAW in South Africa and tells us that the factory at Coega is not the only investment underway right now. “FAW is still China’s largest vehicle manufacturer and up there among the top three or four in the world in terms of volume. In 2011, they were looking at figures of around 2.6 million vehicles produced. They are a Fortune-500 company that’s jumped from below 200 up to 167th on the list. In the same year Coca-Cola was around 206th worldwide and that gives a good perspective of the size of FAW. “This year is our 20th anniversary is SA. The company was started by Richard Leiter, the MD and CEO of our trucking business based in Isando. The sales office and head office are still there and an assembly factory opened in 1994 in Spartan, Kempton Park. “It is a truck assembly operation along with our national parts hub and service centre for the Isando sales branch.”
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WBHO/FAW SA
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COMPANY REPORT
EXTRA HEAVY
Mr du Plessis was also keen to point out the size of the build stating: “It’s a huge plant, around 440,000m².” The FAW factory will be located in Zone 2 of the Coega IDZ and it is reported that 500 jobs will be created at the plant in the early stages with more to come as production levels increase. This news is welcomed by the region which is now seeing substantial reinvestment from the automotive sector and FAW SA hope that the region will see further investment and more companies opening up in the area.
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In South Africa, FAW have recently entered the market for extra heavy trucks, opening up the potential to serve many new industries so the new plant will come online just at the right time. “About three years ago, we entered the extra-heavy segment with real gusto and now we can serve markets such as civil engineering operations using tippers, mixers, 8x4s etc. That culminated in the launching of our first extra-heavy truck tractor in September last year at Soccer City, the J6. “This was the first totally FAW sourced and designed truck. From the drawing board up, every aspect of that vehicle was FAW’s pride and joy and it’s also a vehicle that is now being marketed in 140 countries worldwide,” says Mr du Plessis As the company continues to grow in South Africa and on the continent it is not only the WBHO built factory that is underway.
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“We are a rapidly expanding organisation, we are building a new three storey head office here in Isando,” says Mr du Plessis. “We are turning the old Spartan factory into a parts hub which will serve the whole of the southern African area. “We own the Isando sales office, the Pinetown dealership and the Cape Town dealership. We are engaging in the rapid and thorough roll out of a dealer network, supporting the products, nationwide,” he adds.
The Coega plant will have a production capacity of 5000 trucks each year, ranging from small right up to heavy and extra-heavy commercial vehicles. In the second phase of construction, set to be completed in 2015, the factory will add a passenger car production line with the capability of producing 30,000 vehicles each year. When the plant is fully operational, FAW SA will look to further increase production to reach 50,000 units per year, qualifying the company for government incentives under the Automotive Production and Development Programme. With expansion to the head offices and ambitious plans to grow the reach of the dealer network, this is a company which is definitely on the growth path and the new factory will be a huge booster for the whole industry in southern Africa. WBHO’s involvement will only create more jobs for local people and greatly enhance the economy in the Eastern Cape, something which will be welcomed by all stakeholders.
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www.wbho.co.za
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