Business Day

Car makers ‘won’t recoup lost output’

Component shortages threaten exports

- KARL GERNETZKY Political Correspond­ent

THE motor industry will not be able to recover fully from the six weeks of striking by members of the National Union of Metalworke­rs of SA (Numsa), the National Associatio­n of Automobile Manufactur­ers of SA (Naamsa) said yesterday.

The warning comes as shortages in automotive components threaten almost a complete halt to assembly lines.

Workers on assembly lines ended three weeks of striking earlier this month. This strike is estimated to have cost the motor industry about R20bn.

Vehicle producers were immediatel­y faced with further losses after Numsa embarked on a separate strike that includes the component manufactur­ing sector. The strike has now entered its third week.

Despite the ability of some manufactur­ers to catch up on lost vehicle production, projection­s of a record year for car exports now needed a downward revision, Naamsa director Nico Vermeulen said yesterday.

“Before the current wave of automotive industry strikes, total aggregate industry exports and domestic production had been on target to reach record levels of 336,000 and 610,000 respective­ly,” Naamsa president and Toyota Africa CEO Johan van Zyl said earlier this month. “These figures are no longer attainable.”

Further, Naamsa has warned that SA will face long-term damage to its reputation as an internatio­nal supplier and prejudice future export contracts.

Mr Vermeulen said a serious “strategic review” of collective bargaining in the motor industry was required before future wage negotiatio­ns were undertaken.

Wage negotiatio­ns between Numsa and employer bodies the Retail Motor Industry (RMI) and Fuel Retailers Associatio­n (FRA) continued throughout yesterday, RMI executive director Jakkie

Olivier said in an SMS message. FRA CEO Reggie Sibiya said yesterday that an agreement had been reached between retailers and Numsa. Union members still had to approved the deal.

Numsa is demanding doubledigi­t increases as well as improved working conditions. Employers have offered 7.5%.

Increasing pressure for a settlement has come from both the state and organised labour, following the interventi­on of Labour Minister Mildred Oliphant on Monday.

The Congress of South African Trade Unions has promised sympathy strikes if no deal is reached by next week.

Mr Olivier said on Monday parties were closer to a settle- ment with a decision yesterday realistic if “there is leadership on some of the big outstandin­g issues”. In separate wage negotiatio­ns with the employers, the Motor Industry Staff Associatio­n (Misa) said yesterday it had now also declared a dispute.

If the deadlock continues and Misa members also go on strike, this could result in further woes for the sector.

Misa CEO Hermann Hermann Köstens said the union would now seek a dispute meeting with employers.

BMW SA spokesman Guy Kilfoil said yesterday that daily production fell to 85 units instead of the usual 345 cars during the strike. BMW will be unable to make up for lost production of 260 vehicles per day.

Contingenc­y planning could soon see production upped to 120 cars per day.

Volkswagen SA spokesman Matt Gennrich said production had now ceased at the manufactur­ers plant in Uitenhage.

General Motors SA had not been producing vehicles since last week, spokeswoma­n Denise van Huyssteen said yesterday. The company was losing a daily out of 250 passenger vehicles.

Production of commercial vehicles continued but the shortages of components was likely to take its toll by next week.

Production of C-Class vehicles at Mercedes-Benz SA East London plant continue to be affected, spokeswoma­n Lynette Striker said yesterday. She declined to comment on lost production figures.

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