If the heading sounds serious, then all the suits and ties at the event surely added to the gravitas of the morning held by Toyota South African Motors (TSAM) to discuss the local motor industry.
Devi Sankar – the tough investigative journalist of Carte Blanche fame – moderated the event which was held interview-style at the Kyalami Racetrack. Andrew Kirby, President and CEO of Toyota South African Motors kicked off proceedings by celebrating Toyota’s 5.7% growth last year despite the local market’s failing numbers. He predicted that the growth for 2019 would be less than 2% and expanded on the South African Automotive Masterplan (SAAM) which is a replacement of the Automotive Production and Development Plan (APDP) which will stop at the end of 2020. The Masterplan, developed jointly through strategic collaboration between the government, industry and labour unions, will replace the APDP from 2021 to 2035.
The Masterplan will look to double the work output of the South African motor industry and expand our tier 2 and tier 3 suppliers in South Africa who will make components locally. A total of 60% of the vehicles need to be supplied from within our borders in order to rejuvenate our industry, create jobs and meet these goals.
From a TSAM point of view they have already added five local suppliers and will add another 10 suppliers this year. How did they source these new suppliers? Toyota literally put out all of the components that they import on tables and invited local businesses to see if they were able to make these here. They were overwhelmed with the feedback and enthusiasm that they received to work with TSAM and produce those parts locally.
Despite having neighbours who are also in distress economically, there has been an increase of 38% for orders into Africa in 2019 for Toyota already.
Mamello Matikinca-Ngwenya, Chief Economist for First National Bank says that it will be a year of two halves. The first being almost benign and waiting to see what happens at the election polls, and the second “business as usual”. Business confidence is weak due to political uncertainty and as such more people in business will hedge their bets and await the outcome before making any major investment decisions.
Dr Martyn Davies, Managing Director of Emerging Markets and Africa at Deloitte highlighted that Africa suffers from being a dumping ground for second-hand vehicles and that we need to change our perspective and stop accepting this mentality. We need to become a nation of the best and innovation, not a dumping ground for anything anymore.
He also highlighted the fact that Morocco is ahead of us in supply OEMs and that we need to be concentrating our exports into Africa and not just the U.S. and Europe. We have brilliant testing facilities to show conditions in other African countries and this should be used to it’s full potential.
Points were raised around patriotic purchasing. If government decided to only purchase locally manufactured vehicles, it would add an immediate R3.1billion back into our purses alone. Definitely worth thinking about to make sure we protect our industry.
TSAM making a difference at home
“We decided as a company to look within our entire chain – components, OEMs, distributors and dealers – to see how well we were doing with transformation and how we are making a difference at the coal face,” said Andrew.
There was a call to look to develop in the more rural and informal sectors and TSAM are happy to say that they now have 13 black owned dealers and are planning to grow this number by another 10 over the next two years.
They are involved in the Yes4 Youth campaign where youth get experiences in the workplace for a year and then hopefully find work with their new-found skills thereafter. TSAM have offered 497 internships this year to grow our skills shortage and create opportunity for our younger generation.
TSAM have sent 25 black female engineers overseas for training in the last 10 years, and have trained 56 principal female engineers thus far. These are only some of the projects that TSAM are involved in.
Personally I am upbeat to hear that there are plans afoot to grow the motor industry and let’s pray that we can rejuvenate our market into the powerhouse it deserves to be.
By Claire Macfie