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Local Manufacturing Opportunities Lay In Deeper Localisation

21st August 2019 – At a recent South African Excellence Movement (SAEM) seminar hosted by the Johannesburg Chamber of Commerce and Industry (JCCI), National Association of Automotive Component and Allied Manufacturers (NAACAM) commercial director Shivani Singh said she believes that South Africa’s automotive manufacturing growth opportunities lie in deeper localisation involving Tier 1, Tier 2 and Tier 3 manufacturers, as the majority of components are currently imported.

Singh also suggested that there should be a greater focus on using equity and accounts, when available, for manufacturers to be able to locally produce more raw materials and components for the automotive sector.

Meanwhile, South African Capital Equipment and Export Council (SACEEC) CEO Eric Bruggeman pointed out that South Africa imported R178-billion worth of goods in the last financial year, amounting to about 6% of its gross domestic product. However, considering that there are a lack of suppliers in the manufacturing sector, Singh suggested that allied industries need to become involved, especially if they have the capability and competence.

Madala & Associates CEO Diley Naidoo noted that this could assist in transforming South Africa from a consumer-driven society to a world-class producer and manufacturer, with increasing local and export opportunities. He added that manufacturing offered the greatest potential to create jobs at respectable pay levels for unskilled and semi-skilled workers, with an estimated 90% of jobs expected to come from small, medium-sized and micro-enterprises (SMMEs) by 2030.

However, “Partnerships and training would be key before a company could look at local content”, Bruggeman noted. SMMEs would also need to stop “leaning on government and do it for themselves”, he averred.

Additionally, RSPH CEO and co-founder Ian Huntly said that, while there was a lot of excitement surrounding the Fourth Industrial Revolution, SMMEs needed to be mindful of “where they really are right now”. Here, he suggested that businesses identify their problem areas and address these, while also getting process reliability under control, and improving quality and dependability, speed, flexibility and cost.SPH