Trans­for­ma­tion fund on track

The aim is to de­velop black au­to­mo­tive own­er­ship

The Star Early Edition - - NEWS - Roy Cokayne

THE GOV­ERN­MENT was work­ing ag­gres­sively with South Africa’s au­to­mo­tive in­dus­try to en­sure the suc­cess of the in­dus­try’s planned cre­ation of a R3.5 bil­lion trans­for­ma­tion fund that would al­lo­cate funds to de­velop black own­er­ship in the car in­dus­try sup­ply chain and ve­hi­cle deal­er­ship net­work.

Mike Whit­field, the pres­i­dent of the Na­tional As­so­ci­a­tion of Au­to­mo­bile Man­u­fac­tur­ers of South Africa (Naamsa) and man­ag­ing di­rec­tor of Nis­san South Africa, con­firmed this yes­ter­day, adding that ev­ery­one the in­dus­try had in­ter­acted with in gov­ern­ment about the ini­tia­tive had “been very pos­i­tive” about it.

The lead­er­ship of Naamsa an­nounced the ini­tia­tive in June fol­low­ing dis­cus­sions with the ANC prior to its pol­icy con­fer­ence.

Whit­field said Nis­san South Africa di­rec­tor of cor­po­rate af­fairs and com­mu­ni­ca­tion, Wonga Me­satywa, had been part of the au­to­mo­tive in­dus­try team that had been in­volved in dis­cus­sions with the gov­ern­ment.

Me­satywa said there were a lot of de­tails about the ini­tia­tive that the team was still work­ing through with the gov­ern­ment.

Dis­cus­sions

He said that they hoped to con­clude those dis­cus­sions within about the next four weeks and then host an ind­aba with the Black Busi­ness Coun­cil and all other in­ter­est groups, in­clud­ing the Na­tional Union of Me­tal­work­ers of South Africa, to de­cide on the fi­nal prod­uct.

“Those are part­ners we have to agree with in terms of what we are want­ing to do,” he said.

Me­satywa de­nied sug­ges­tions by in­dus­try sources that the ini­tia­tive was de­pen­dent on

R3.5 bn Sum en­vis­aged for the planned trans­for­ma­tion fund

gov­ern­ment ac­cept­ing it as an equity equiv­a­lent ini­tia­tive for the own­er­ship pil­lar of the new broad-based black eco­nomic em­pow­er­ment (BB-BEE) codes.

“We are do­ing this be­cause it’s the right thing to do. The (BB-BEE) points are con­se­quen­tial. They just come be­cause we are do­ing the right thing.

“It’s not being done be­cause of the points. It’s being done be­cause we do need to make sure we di­ver­sify the sup­ply base,” he said.

Me­satywa said the BB-BEE points ve­hi­cle man­u­fac­tur­ers would be cred­ited with for the ini­tia­tive was still un­der dis­cus­sion.

Whit­field added that the big­gest problem fac­ing the do­mes­tic au­to­mo­tive in­dus­try to­day was that there were so few black-owned in­dus­trial busi­ness that could sup­ply the au­to­mo­tive in­dus­try.

“You can find smaller SMEs (small and medium en­ter­prises) but that’s not the is­sue.

“This ven­ture will only be al­lowed to in­vest in down­stream and up­stream in the auto in­dus­try so down­stream will be com­po­nents sup­pli­ers and up­stream will be the deal­er­ships.

“But it’s not just a dealer but a dealer group and ve­hi­cle fi­nanc­ing and then side­ways in skills development,” he said.

Me­satywa said Naamsa had in­ter­acted with the Na­tional As­so­ci­a­tion of Au­to­mo­tive Com­po­nent and Al­lied Man­u­fac­tur­ers, which was look­ing at its own pro­grammes that they could in­flu­ence.

How­ever, Me­satywa there was noth­ing stop­ping the two or­gan­i­sa­tion com­ing to­gether at some stage be­cause es­sen­tially they were both look­ing to achieve the same goal.

Whit­field added that many large first tier global sup­pli­ers had asked to be part of the ini­tia­tive.

Ab­so­lute plea­sure

He said Naamsa had in­di­cated it would be “an ab­so­lute plea­sure” to ac­com­mo­date them but not in the first phase of the ini­tia­tive.

“The rea­son is very sim­ple. It’s tough enough to get seven of us (ve­hi­cle man­u­fac­tur­ers) to align and agree so we want to cre­ate the foun­da­tion and then we can in­vite them,” he said.

Tim Ab­bott, the chief ex­ec­u­tive of BMW Group South Africa and sub Sa­ha­ran Africa and also a Naamsa mem­ber, said in June when the ini­tia­tive was an­nounced said the fund would be held through a black fund man­ager with a board of man­age­ment that in­cluded original equip­ment man­u­fac­tur­ers and the gov­ern­ment through the trade and in­dus­try depart­ment.

Ab­bott said the in­ten­tion was to ex­pand the ini­tia­tive in the longer term to also in­clude ve­hi­cle im­porters and ma­jor com­po­nent man­u­fac­tur­ers.

PHOTO SUPPLIED

Very pos­i­tive – Mike Whit­field, the pres­i­dent of the Na­tional As­so­ci­a­tion of Au­to­mo­bile Man­u­fac­tur­ers of South Africa and MD of Nis­san South Africa.

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