Ford in R3bn Silverton investment
• Speculation next generation Ranger to be built locally
The latest R3bn investment to increase production capacity of the Ford Ranger pick-up in SA made it almost certain that the vehicle’s next generation would also be built locally, motor industry insiders said at the weekend.
The latest R3bn investment to increase production capacity of the Ford Ranger pick-up in SA made it almost certain the vehicle’s next generation would also be built locally, motor industry insiders said at the weekend.
Ford Southern Africa MD Casper Kruger said on Friday that the latest cash injection would raise annual capacity from 110,000 to 127,000 and enable the Silverton, Pretoria, assembly plant to build a new Ranger variant, the Raptor.
US motor giant Ford has spent nearly R10bn in SA to make a success of the current Ranger, which was launched in 2011. Most of that has been spent at Silverton, but the company’s Port Elizabeth engine plant has also benefited.
Most bakkie generations have a life cycle of about 10 years, meaning a new Ranger is due around 2021. Kruger said increased capacity on the current model would be available from January 2018, and the Raptor would be built from 2019.
He insisted the new investment was no guarantee that future Ranger generations would be manufactured in SA. Despite Ockert Berry, head of operations for Ford Middle East and Africa, saying it “reaffirms Ford’s ongoing commitment to SA as a local manufacturer, exporter and key employer”, Kruger said: “This is about current product. It is not a statement on the next generation.”
However, insiders said the timing of the investment made future local assembly highly likely. “Are they really going to spend billions of rand on something they plan to halt immediately afterwards?” asked one.
The timing is also important in the context of government automotive policy. The Automotive Production and Development Programme, which rewards manufacturers with import duty benefits and investment rebates, will expire at the end of 2020 and the Department of Trade and Industry is trying to reassure multinational motor companies that similar incentives will continue afterwards. Planners are working on a new programme that will run to 2035.
Despite an impasse over government demands on black empowerment, companies seem confident that a compromise can be found.
Ranger is Silverton’s only product. The range includes single- and double-cab bakkies and the upmarket Everest sport utility vehicle. Kruger said the plant would build 80,00090,000 vehicles in 2017. Increased capacity would not only allow for projected demand growth but also create manufacturing flexibility.
Ranger is one of SA’s two popular vehicles, along with the Toyota Hilux. Both outsell any car ranges. The Ranger is also exported to more than 140 markets around the world.
Kruger said “we are in constant competition with other Ford plants for [exports]”.