Building the foundations for the automotive sector’s future

Motor industry focus

Building the foundations for the automotive sector’s future

An investment of more than R1.2-billion has brought a welcome economic boost to Eastern Cape. The province is home to a large segment of South Africa’s automotive industry. The sector is expected to see significant changes over the next few years, as it adapts to accommodate the increasing demand for electric vehicles in Europe and the UK, as well as producing vehicles for export across the continent.

INVESTMENT INTO CURRENT PRODUCTION LINES

The recent investment from Isuzu Motors South Africa will see the next generation Isuzu bakkie built on a production line at the company’s Gqeberha manufacturing plant. The new production line will produce the seventh generation of the Isuzu bakkie, the D-MAX.

President Cyril Ramaphosa attended the launch of the new Isuzu D-Max bakkie, saying Isuzu Motors South Africa’s R1.2 billion investment would greatly assist efforts to expand local production.

"The automotive industry is one of our economy’s most important sectors. It is a significant source of employment and small business development in the Eastern Cape, particularly in Gqeberha.

I want to thank Isuzu Motors for supporting the localisation objectives contained in our Automotive Production Development Programme," President Ramaphosa said.

The project has unlocked around 1000 direct jobs at Isuzu Motors South Africa’s Gqeberha production plant and 235 new job opportunities at local component manufacturers. It also resulted in improvements and upgrades of the plant.

The Eastern Cape is home to several key vehicle manufacturing plants, including Volkswagen and Mercedes Benz South Africa’s (MBSA).

Volkswagen recently celebrated producing its 100 000th unit of the current Polo Vivo in Kariega. The car has been under production at the manufacturing plant since 2010 and is built exclusively for the South African market.

Meawhile, 16 new companies linked to MBSA new C-Class project (W206) have invested around R3.3 billion in the East London Industrial Development Zone (ELIDZ). The investment has the potential to create more than 2000 jobs, and the companies have already started operation from their new premises in the ELIDZ to supply MBSA with various automotive components.

Premier Oscar Mabuyane says the automotive sector is adding to skills development among the youth, as well the economic recovery of the province.

“The automotive sector is critical for our province. It continues to be the mainstay of our provincial economy. It drives manufacturing activities and the larger economic vibrance of our metros and our province, and it is the biggest Gross Domestic Product (GDP) contributor in the province,” he stated.

PREPARING PRODUCTION TO MEET FUTURE MARKETS

The national government has in place an automotive master plan, driven by the Department of Small Business Development, which aims to increase the local content among first and second-tier suppliers, and focuses on creating special economic zones – with many of those in the automotive sector operating in these zones.

Deputy Minister of Trade, Industry and Competition Nomalungelo Gina says: “Special Economic Zones seeks