China threatens local auto industry’s Africa markets

THE AFRICAN market
represents a vast untapped
market which South Africa
is in danger of losing to the
East, according to speakers
at the first South African
Automotive Week “Wheels
into Africa” conference
held in Port Elizabeth from
October 3-5.
Gavin Maile, executive
partner KPMG Industrial,
Automotive and
Pharmaceutical Division,
urged the local auto
industry to “take control”
of the African market ahead
of competitors from
the East.
China is one of the main
threats to the local industry
as Chinese manufacturers
for the first time have an
excess capacity of some
1.5 million vehicles. Africa
is seen as a prime market
for the excess vehicles,
evident from the large
number of new Chinese
brands introduced to South
Africa in the past year.
Growth prospects for
Africa are positive, as the
continent is the only one
in the world for which a
higher economic growth
rate has been forecast
for 2007, added Jorge
Maia, head of Research
and Development at the
Industrial Development
Corporation of SA in his
presentation on trade and
trade patterns into Africa.
This provides a number
of opportunities for
exporters of vehicles and
parts.