VWSA invests R6.1 billion to develop local content

2018-02-01 06:00
=Premier of the Eastern Cape, the Hon. Phumulo Masualle, Chairman and Managing Director of Volkswagen Group South Africa, Thomas Schaefer, Deputy Minister of Trade and Industry, the Hon. Bulelani Magwanishe, MEC for Finance, the Hon. Sakhumzi Somyo Photo:HOTPRESSMEDIA

=Premier of the Eastern Cape, the Hon. Phumulo Masualle, Chairman and Managing Director of Volkswagen Group South Africa, Thomas Schaefer, Deputy Minister of Trade and Industry, the Hon. Bulelani Magwanishe, MEC for Finance, the Hon. Sakhumzi Somyo Photo:HOTPRESSMEDIA

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Volkswagen launched its new Polo and showcased the R6.1 billion investment in its plant and new products, in the presence of Eastern Cape Premier Phumulo Masualle, the honourable Deputy Minister Bulelani Magwanishe of the DTI, media representatives and key stakeholders.

In August 2015, VWSA Chairman and Managing Director, Thomas Schaefer, announced an investment of around R4.5 billion rand in new product and facilities. The total investment exceeded R6.1 billion rand, which is partially due to exchange rate fluctuations and the approval of additional plant investments.

Localisation remains a key priority for VWSA, with the new models at a 60% local content level, with on-going plans to achieve higher levels.

Volkswagen introduces the innovative One-line Concept for the first time as part of the investment. Traditionally vehicles are assembled on unique production lines.

In line with being a socially responsible employer VWSA did not release any employees as the production volumes decreased during the ramp up, but rather retained them in training pools until the third shift commences in April, this year.

VWSA produced 110 000 cars last year. This will increase to 133 000 for 2018 of which 83 000 will be exported to markets around the world. Maximum annual plant capacity is expected to be reached with a 3 shift operation of some 160 000 vehicles, in 2019.

“The South African Government must be complimented for the introduction of the Motor Industry Development Programme, which gave confidence to the industry and provided a stable base for the successor programme, the Automotive Production and Development Programme which has also been successful in ensuring a future for the automotive sector in South Africa,” said Thomas Schaefer, Chairman and Managing Director of Volkswagen Group South Africa.

“The Automotive Sector of the South African economy accounts for the direct employment of 113 000 people.”

The Premier of the Eastern Cape Phumulo Masualle said, “The automotive sector is one of the key sectors in our provincial economy mix, which we believe, alongside the Oceans Economy, Agriculture and Energy, if correctly leveraged, can see the Eastern Cape Province not only grow the regional economy and contribute towards further national economic growth, but also become a leader in the drive to modernise and re-skill our work force.”

Deputy Minister Bulelani Magwanishe of the Department of Trade & Industry said, “It is a privilege to commend VWSA on the launch of its new Polo and its investment of R6,1 billion. Therefore, this investment is particularly relevant to ensure expansion, socio-economic impact and the inclusion of Black Industrialists.”

The Volkswagen Group retained its number one position in the passenger market for the 7th consecutive year in 2017, achieving a 21.8% market share. One in every 5 cars bought by South Africans last year is either a Volkswagen or an Audi. The Volkswagen brand in the run-out year, of its volume models, the Polo and Polo Vivo achieved a share of 18.9% meaning that the Volkswagen Brand was the passenger market leader, even without its sister brand Audi.

The Polo Vivo and Polo have also been ranked the best selling cars in South Africa since launch in 2010. That is for 7 consecutive years. They are being replaced by the new Polo launched at the event and the new Polo Vivo which will be launched next month.

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