The new R16-billion investment by Ford at the manufacturer’s Silverton plant, when completed, will pump R1.3 billion in wages and salaries annually into the Tshwane economy, according to an announcement by the Department of Trade and Industry (DTIC) yesterday.
The announcement follows the designation of the area as a Special Economic Zone (SEZ) in late 2019 by Minister of Trade, Industry and Competition Minister, Ebrahim Patel.
The investment will cover expansion of the Ford assembly plant in phases to reach a capacity to assemble 200 000 vehicles locally, principally centred on the new Ford Ranger bakkie.
An anticipated 1 200 jobs will be created in the Ford plant with thousands of additional jobs at suppliers to the company.
The Ford Motor Company has been in negotiation with the DTIC on the expansion of the plant, making it one of the largest Ford Ranger plants outside the United States.
Several government policies championed by President Cyril Ramaphosa, who delivered the keynote address at the event, had informed Ford’s decision and enabled rapid decision making, Patel said.
“First, the Special Economic Zones framework. In October 2019 we revamped our Special Economic Zone policy, leading to the designation of Tshwane as an Automobile SEZ. Based on this, Ford took the opportunity to announce that they would help build a massive supplier hub in Tshwane and this in turn made the massive investment in the Ford plant itself worthwhile,” Patel added.
“Tshwane is on the road to becoming an Auto City, producing cars for local use and export to more than 150 countries.”
Patel said the mobilisation of investment had also played a role.
“President Ramaphosa set a target of R1.2 trillion of fresh investment to be raised over a five-year period in order to grow the economy. The announcement of R16 billion by one firm alone is 1.3% of the total.
“It will create jobs for women and young people and opportunities for small businesses and local suppliers,” he said.
He added that the reimagined industrial strategy focused on sector partnerships called masterplans. “The Ford announcement is made possible by the auto-masterplan, which seeks to double jobs and auto production in South Africa by 2035.”
The minister said transformation and opportunities for small and medium businesses were key goals of the master plan.
The announcement of the first major investment has come less than 15 months after the designation of the SEZ.
Further announcements would be made in the next 18 months as suppliers finalised plans and took occupation of state-of-the art production facilities.
“This is a boost for our efforts to recover growth and jobs in the economy following the impact of Covid-19 on livelihoods and to prepare South Africa for the opportunities of the AfCFTA,” Patel said.