Exports could drop by 35%

Government and the auto
industry are working
together on a bail-out plan
as both the local and export
markets crash.
The Minister of Trade
and Industry met with the
presidents of the National
Association of Automobile
Manufacturers of South
Africa (Naamsa) and the
National Association of
Automobile and Allied
Component Manufacturers
(Naacam) on February 24.
A statement issued after
the meeting says “a number
of matters requiring urgent
attention were identified and,
to this end, a Dti – Naamsa
– Naacam Task Group
was established to finalise
specific proposals with
regard to possible support
measures for the industry.”
While exports helped
carry the local industry in
2008, they started falling this
year – and the situation is
expected to get worse.
According to Naamsa,
exports of South Africanproduced
motor vehicles
during January 2009 at
10 713 vehicles was 835
units – or 7.2% – less than
the 11 548 vehicles exported
during January 2008.
“Looking at the
international environment,
the sharp slow-down in
South Africa’s major export
markets (Eurozone, Japan
and the United States) would
inevitably translate into
significant declines in the
number of vehicles exported
by the industry during
calendar 2009.
“At this stage,
manufacturers’ projections
suggested that overall
industry export sales could
decline by as much as 35%
from last year’s record level
of 284 211 vehicles.
“Any improvement
in international trading
conditions would only
occur once the severe global
economic and financial
crisis dissipated. Given the
magnitude and seriousness
of the global economic
crisis, it was anticipated that
any recovery would only
eventuate in 2010 or 2011,”
said Naacam.