The big automotive issue for consumers in South Africa recently has been the introduction of a car pool lane around Johannesburg for vehicles carrying two people or more.
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Predictably, in a city where traffic is chaotic at the best of times – a 10km commute can take 10 minutes or 90 minutes – the new system has had its teething problems.
That’s largely because the pool lane quickly gets filled with overladen minibuses and bakkies (pick-ups), passengers perched precariously in any available space – inside or outside the vehicle.
Add high speed taxis to the mix and you have a receipe for disaster; road accidents and the resultant deaths and injuries are almost at carnage proportions on South Africa’s roads.
The introduction of the car pool lane, however, has coincided with the opening of Auto Africa, the Johannesburg-based Motor Show, given international status for the first ever.
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By GlobalDataThe show organisers are very pleased about that, although it’s not immediately obvious what the significance is. A couple of top execs were flown in from Europe and Japan while international journalists on press day numbered 25, including this correspondent, the only one from the UK.
In fact most of the hacks had come from northern Europe so you can see the attraction of Johannesburg, sweltering last week in a spring heatwave of 35 degrees plus.
Vehicle sales in South Africa are riding high, now regularly achieving a million cars plus a year and the vehicle parc is getting newer. Many people are more likely to splash out on cars and clothes rather than their homes.
Yoshima Ishii, Toyota’s managing director for Europe and Africa said he believes vehicle sales will continue to grow as he launched the Avanza, a new affordable MPV for the South African market.
Toyota is also ramping up production at its plant near Durban from 150,000 to 220,000 units a year by 2008. Johan van Zyl, the company’s South Africa president and CEO, said about half the production would be exported to Europe and the rest of Africa.
South Africa has been used as a right hand drive production base by a number of companies. BMW, manufacturing in Pretoria, and Mercedes-Benz (East London) have shipped to places like Australia and the UK, as has Volkswagen in Port Elizabeth.
General Motors is starting production of the Hummer H3, also in Port Elizabeth, and announced here that it will start exporting the model to Australia from the middle of next year.
DaimlerChrysler also announced that it is to start exporting fully-built Mercedes-Benz C-Class to the United States next year.
DCX chief in South Africa, Hansgeorg Niefer, said that between 10,000 and 15,000 models would be exported to the US annually. A R2 billion (US$266 million) expansion has been made at its East London plant ready for the launch of the new model in the middle of next year.
BMW has been exporting 3-series models to North America for a number of years.
Mazda once has its highest market share anywhere in South Africa and it is currently building sales again. It flew in the big chief from Hiroshima, Dan Morris, to announce an aggressive product introduction over the next year.
The intro of the Mazda5, MX-5 roadster coupe, Mazda6 MPS, Mazda3 MPS and the CX-7 will double the company’s offering.
So, everything looks bright from the South African auto industry?. Well, not quite. There are issues, some of which are being solved, but the wheels are turning slowly.
Top of the bill is the review of the Motor Industry Development Plan which runs through to 2012. This review, which looks at the balance between imports and exports among other things, was due earlier this year and is now expected sometime in November.
Suppliers have their own problems – trying to compete with rivals in emerging markets, plus a whole different set of issues when dealing with the local manufacturers.
Ford, for example, is run from Asia Pacific and benchmarks prices there. GM, on the other hand, is run from Brazil. Others take their orders from the United States, Europe or Japan.
The manufacturing industry is having to learn to compete on a global basis, often with one hand tied through trade restrictions. These are also being addressed with preferential trade agreements being negotiated currently with the South America Mercosur regions plus other areas in Asia.
Chris Wright
