How Team SA can lift the 'world cup'

Just as South Africa rallied
support for Team SA during the
Rugby World Cup, the business
world should be thinking along
the same lines.
South African companies
should see themselves as
Team SA – vying with global
competitors for global business.
That’s the view of Transnet
Freight Rail executive manager
intermodal business
unit, Wiseman
Madinane, who
points to the
automotive industry
as a prime example.
“South African
automotive
manufacturers are competing
with the likes of Thailand,
China and India. The Indian
Hyundai plant produces one
million Hyundai i20s per year.
In South Africa, we estimate
that BMW produces up to
80 000 3-series, Ford up to
80 000 Ford Rangers, General
Motors no more than 50 000 of
a range of vehicles and Toyota
no more than 200 000 Hiluxes
and other cars. This therefore
suggests collectively South
Africa is by far shy of a million
cars.”
This, says Madinane,
amplifies the competition
we face. “The auto industry
should never see themselves as
competitors but rather as part
of a country that is trying to
compete with the rest of the
world.
“We have invested half a
billion rand in
wagons to provide
access for the
OEMs (original
equipment
manufacturers) in
Pretoria to their
markets and the
coastal OEMs to the Gauteng
economic domestic hub.
Around 700 wagons have been
delivered in the past two years.
“We are now considering
whether to put money in as
Transnet or through a public
private partnership (PPP)
where TFR would provide the
rail infrastructure, terminals
and traction power, and the
private sector would fund the
wagons. It’s a model that has
been tested and it works.”
PPPs are also seen as a
solution in the fruit industry
where the seasonality of the
cargo raises questions about
investment in specialised
equipment.
“We have started investing
in more reefer trains but it’s a
very tricky business when you
look at your capital investment
and rate of return.
“We have started signing
agreements with some of the
fruit industry players where
they have committed some
volumes on the seasonal work
– but we’re also looking at
the domestic opportunities.
Around 60% of what is
produced in South Africa is
consumed in Gauteng so we
are looking at how to keep
wagons utilised throughout
the year so we can realise our
return on investment.
“PPPs could be an
option in this sector where
someone else puts up the
money for the equipment
and we offer the network to
utilise those wagons.”
INSERT
1m The number of Hyundai
i20s produced by the Indian
Hyundai plant in one year.