Taxi plant to boost economy

TRADE and Industry Minister Ebrahim Patel has launched a taxi manufacturing expansion plant in Durban, KwaZulu-Natal, to the tune of half a billion rand, the department said on Monday.

The plant expansion is part of the Toyota South Africa Motors (Tsam) Hiace Ses’filikile Plant.

Patel said the investment of almost R500 million was another vote of confidence in the capability of the South African automotive industry and the KwaZulu-Natal economy.

“Manufacturing is the largest contributor to economic output in the province, supporting more than 350000 direct jobs,” he said.

Patel encouraged the automotive industry to prioritise the local production of vehicles in line with the automotive master plan and to look at electric and hybrid vehicles in future expansion plans.

“Last year, government and stakeholders adopted an automotive master plan, aiming to achieve 1% of global vehicle production by 2035, increase the current 600000 units to almost 1.4 million a year and increase Iocal content from 39% to 60%.

“The master plan is targeting to double employment in the value chain from current levels to about 240000, and also to achieve at least level 4 BEE status from 2021,” Patel said.

The minister indicated that localisation must be a driver of development and opportunity, noting that localisation built a manufacturing footprint.

Since Tsam’s localisation programme began, Patel said, more than 80 000 taxis had been assembled locally by Toyota and a smaller assembler.

“The increased level of local content is an important part of the vision for the industry and will increase the participation of more South Africans in this thriving sector of the economy.

“It’s also a practical implementation of the commitment Toyota made at the investment conference last year,” he said.

Tsam and chief executive Andrew Kirby said in terms of the South African automotive master plan (Saam), local automotive value addition needed to be exponentially increased.

Kirby said Tsam was committed to supporting the Saam, and had therefore pro-actively increased the local value addition of the Hiace Ses’filikile from 38% to 44%.

“This localisation has added R422 million a year local value to the economy. Even more encouraging is that we’ve been able to create an additional 80 jobs,” Kirby said.

Kirby also announced the start of the company’s export operations to support assembly in Kenya of Hilux.

“Tsam is embracing the direction of local assembly, and has invested close to R20m in the establishment of our packing plant,” he said.