Load-shedding must not spoil the party

In a province marked by economic uncertainty and huge unemployment figures, any news of a substantial investment is cause for celebration. VW Group Africa announced on Tuesday it would invest R4bn in its Kariega plant. This is being done as the group views Africa as the last frontier for automotive development with internal combustion engines. While many global vehicle markets are swiftly transitioning to electric vehicles, African markets like SA are poised to continue manufacturing and selling vehicles with internal combustion engines for the foreseeable future.

The UK proposes banning sales of new internal combustion vehicles from 2030 and the EU from 2035.

VW Group Africa has acted swiftly to change its business model.

Since 2011, it has invested R10.28bn in the Kariega plant. The investment not only brings a significant boost to the Eastern Cape economy, but also signifies a renewed commitment to the region, residents and the group’s supply chain.

The ripple effects of this investment will extend beyond the plant.

While the R4bn investment will not necessarily increase the number of jobs at the plant, it will provide security for its more than 4,000 direct employees in SA as well as several opportunities for growth for the more than 50,000 indirect jobs supported through its 73-year operation in the country.

VW Group Africa managing director Martina Biene said: “SA is an important market for the Volkswagen Group, particularly in terms of our long-term goal to establish our footprint on the continent, which is seen as the last frontier for automotive development.”

But while there is much to celebrate, Biene raised the issue of load-shedding.

The Eastern Cape’s three original equipment manufacturers — VW Group Africa, Isuzu Motors SA and MercedesBenz SA — were the only ones not exempt from load-shedding.

This means they are forced to compete on unfair terrain. While trade, industry and competition minister Ebrahim Patel celebrated the investment, he should be working tirelessly to ease the burden for original equipment manufacturers in the Eastern Cape.

Resolving the issue of load-shedding for such crucial companies is vital for the Eastern Cape economy.