SOUTH AFRICA: BMW warns of SA risks as exports slump
BMW South Africa is warning that continuing industrial action in South Africa is damaging the reputation for reliability of South Africa's automotive manufacturing sector and threatening future investment.
A report in South Africa's Business Day newspaper cited remarks by BMW South Africa's MD Bodo Donauer.
Donauer told Business Day that BMW South Africa will have to pay up to 25% extra to import cars into South Africa because of the continuing motor industry strikes.
The company says the slowdown is hurting its profile as a reliable supplier. The strikes, first by assembly workers and then component makers, have also affected South Africa’s image among foreign investors, Donauer said.
"Customers in Japan and the US don’t know or care that this is a South African labour issue," he told Business Day. "They want their BMWs."
"There is a clear call in this country to create employment. South Africa needs decent jobs,” he added. “We have hired hundreds of new workers and our suppliers another thousand or more. And what have we got out of it? A series of strikes, the loss of future jobs and serious reputational damage, not just to us but to the South African motor industry as a whole, as an industry that can be trusted to deliver."
The report added that the strike by component manufacturer employees shows no signs of abating. Vehicle firms Nissan, VW, Tata and General Motors on Wednesday said their plants were still shut or idled, the report said.
Mr Donauer also said that two German BMW plants — in Munich and Regensburg — had made up some of the lost export orders, but have no spare capacity for more. He also confirmed that the loss of export earnings means the company is no longer earning import duty rebates.
Donauer also suggested that BMW SA's reputation as a reliable manufacturing source for the 3 Series has been damaged and could impact future investment plans.