Beating KZN’s auto sector blues

2010-07-21 00:00

THE KwaZulu-Natal automotive sector, which has been hard hit by pre-recession and post-recession blues, has an ambitious long-term strategy that is aimed at doubling the size of the sector in the province by 2020.

The vision, which was presented at the Durban Automotive Cluster’s (DAC) annual meeting in Durban yesterday, comes on the back of a decline of five percent in employment in the KZN automotive component sector between June 30, 2008, and December 31, 2009.

The DAC is a public-private partnership between the automotive manufacturing industry in KZN and the eThekwini Municipality.

A number of Pietermaritzburg-based member firms are members of the DAC. Three Pietermaritzburg-based firms — Kaymac Structural Foam, Maritzburg Engineering and Ramsay Engineering — won three of the eight company awards presented.

The DAC said a database of retrenched individuals with scarce skills was created to help with their re-employment.

Indicators that will be linked to the DAC’s long-term vision include local value addition, output levels and employment numbers.

The DAC will focus on five key areas, namely localisation and supplier competitiveness, skills development and skills retention, infrastructure reliability and competitiveness, transformation and growth through market linkages, and investment.

Learning from international trends is also useful for the improvement of the local sector, the DAC stressed.

The DAC’s analyses of the automotive sectors of Thailand and Turkey have revealed important lessons for the KZN sector.

Thailand’s production advantages relate to input costs.

The DAC said that KZN needs to address its labour cost competitiveness, as well as “shopfloor” productivity and overhead costs, particularly energy costs.

The automotive director at the Trade and Industry Department (DTI), Mkhululi Mlota, told guests that the department is working on completing certain guidelines for its automotive production and development programme by the end of the financial year.

Mlota added that the government is also serious about assisting companies to unlock the value of public sector procurement, particularly in relation to the government’s procurement of buses.

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