MISA News

Automechanika SA International Show: 09 – 12 March 2011 (NASREC)

As you may know, MISA not only exhibited at the recent Automechanika trade show at Nasrec in Johannesburg, we also hosted a round table breakfast with SA’s Deputy President, Kgalema Motlanthe, pictured right, as the keynote speaker.

The purpose of the breakfast was for MISA to create an opportunity to network with business outside of the traditional boardroom discussions and to identify issues of common interest. These issues need to be discussed as part of a broader strategy for the industry to ensure protection and growth in employment.

The most important issue identified is the need to strengthen the small and micro enterprises in the retail motor trade. These two categories of business jointly employ 30% of employees in the industry and they are the businesses with the highest potential for employment creation.

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Government will continue to support SA automotive industry

Deputy President Kgalema Motlanthe was the keynote speaker at a MISA round table breakfast recently. We bring highlights of Mr Motlanthe’s speech.

  • Government sees the automotive industry as “an engine of economic growth” and, as such, the industry will continue to enjoy considerable government support to realise growth and prosperity.
  • The current Motor Industry Development Programme (MIDP) and Automotive Production and Development Programme (APDP) remain important industrial policy tools to support, promote, and advance the future sustainability of the South African automotive sector.
  • The partnership between government, labour, business and other role players will be indispensable for the recovery from the job losses experienced in the past few years as a result of the global economic meltdown.
  • Despite notable successes achieved by the automotive, medium, and heavy commercial sectors, there is still a need to build adequate capacity in this sector. Here, the financial backup from the Industrial Development Corporation (IDC), as stated by President Jacob Zuma in the state of the nation address, will be critical for the objective of making improvements on a broader scale.
  • Government's continued support for the automotive sector has created favourable conditions that made it possible to attract an upward investment of R13-billion from original equipment manufacturers (OEMs).
  • Encouraging domestic manufacturing and production of automobile products in South Africa will undoubtedly contribute to the creation of more jobs in our country.
  • Government will continue to work with the industry in developing and honing skills to ensure that South Africa remains a preferred location for the production of world-class vehicles.
  • The original equipment manufacturers Purchasing Council will shortly finalise a proposal for a localisation programme, which will strengthen the local component supply chain process.
  • The process to secure further support in the form of a private sector service provider through the Industrial Development Corporation (IDC) is nearing its final stage and is expected to be completed by mid March 2011.
  • The majority of businesses in the retail automotive sector are small entities, which may create job opportunities only if they have the ability to understand challenges facing South Africa and the need to implement correct interventions. The focus should not only be on creating decent employment, but also the provision of necessary training to enhance the industry's capacity in providing quality service to its customers.
  • Transformation: Government has consistently raised concern about the level of economic participation by historically disadvantaged individuals at ownership and management levels. Much still needs to be done to ensure a more representative industry, which draws strength from the diversity of its people and which is therefore better positioned to respond to global imperatives by leveraging our abundant human resources.

 

The SA automotive industry by numbers

  • The South African automotive industry contributes considerably to Gross Domestic Product (GDP) and job creation. It is the largest in the manufacturing sector of the South African economy and contributed 5,9% to the GDP in 2009.
  • In 2009, the South African motor vehicle manufacturing and the component manufacturing sectors employed 30 000 and 61 000 people, respectively.
  • According to the Department of Trade and Industry (DTI), during 2009, the whole value chain of the automotive sector employed 230 000 workers.