SA leads African pack in vehicle manufacturing

Despite attempts by countries such as Kenya and Nigeria to stimulate and support their motor industry, South Africa is the only sub- Saharan manufacturing centre reporting growth, according to the International Organisation of Motor Vehicle Manufacturers (OICA). Its statistics reveal that South Africa recorded growth of 1.2% in vehicle manufacturing between 2012 and 2013 – from 539 424 to 545 913. Looking at the continent as a whole, this is well below the 54% growth reported by Morocco, which is home to a giant Renault factory, which is the largest assembly plant on the African continent. Manufacturing remained static in Zimbabwe (829) and Kenya (3 080). Production in Kenya will show strong growth as new production lines come on stream. The country has three assemblers – Associated Vehicle Assemblers (AVA), Kenya Vehicle Manufacturers and General Motors East Africa (GMEA). The General Motors plant is the only bespoke facility, with the others catering for multiple marques. One of the strongest growth areas is expected to be in the medium and large bus segments, as Kenya phases out 14-seater minibuses. New-look Isuzu buses were launched in parallel with an assembly plant upgrade, and GMEA announced plans to introduce a sixth generation Isuzu one-ton pick-up. Isuzu dominates the Kenyan heavy trucks sector with its F-series from 13-22 tons. GMEA is facing stiff competition, with Toyota/ Hino, MAN, Scania and Iveco all setting up assembly and distribution operations. Kenya is supporting local manufacturing through tax incentives. Imports of completely knocked down units (CKD) are zero-rated as opposed to 25% import duty on fully built up units. Kenya’s vehicle assembly plants have an installed capacity of over 30 000 vehicles. Capacity utilisation presently stands at about 20%. Nigeria, which has been trying to develop a motor industry for a number of years, is starting to fire. Nissan is the first original equipment manufacturer to produce vehicles in the country since the country introduced its new automotive policy. Production started on September 8, 2014. Nigeria is supporting local manufacturing by increasing import duties. It is estimated that Nigeria has a new car market of about 50 000 units a year but the market for used cars and grey vehicle imports is estimated at around 450 000 annually. CAPTION A local manufacturing plant... South Africa recorded growth of 1.2% in vehicle manufacturing between 2012 and 2013.