Fighter factory
SA’s beleaguered manufacturing sector is short on good-news stories but there are exceptions. Military equipment group Paramount has proved that with the right technology and business model, SA manufacturers can hold their own against the best in the world.
Paramount’s Mbombe 6X6 armoured combat vehicles are rolling off the production line. They are part of an order for 50 vehicles for the Jordan Armed Forces (JAF), won in the face of fierce international competition.
“Jordan is acquiring one of the world’s most technologically advanced armoured vehicles,” says Ivor Ichikowitz, Paramount founder and executive chairman. “JAF found the Mbombe to be in a league of its own in key areas such as mobility, ballistics protection and cost effectiveness.”
While Ichikowitz does not disclose the price of the Mbombe, he says: “It is 25%-30% cheaper than equivalent US and European vehicles.”
Another factor in Paramount’s success in Jordan and other countries to which it exports is what Ichikowitz terms its “portable production model”.
Central to the model is the formation of alliances with local partners whom Paramount assists in developing skills and a local production capability.
In the case of Jordan a joint venture company, Arabian Defence Industries (ADI), was formed with KADDB Investment Group, Jordan’s equivalent of SA’s Armscor.
The first 25 Mbombe vehicles are being built in SA and the second 25 are to be fabricated and assembled by ADI. “Even with the second 25, a large percentage of components will come from SA,” says Ichikowitz.
The Jordan deal is Paramount’s first big win in the Middle East, but more is planned. “Building long-term relationships with Middle East governments is hugely important to us. The region faces one of the world’s most serious security challenges.”
It comes at a time when the oil price slump is putting a squeeze on military budgets in the region. “Even the wealthiest of Middle East countries must make budgets go further,” says Ichikowitz.
It puts Paramount in a strong position. “We are in the business of providing cost effective solutions,” says