THE Chinese vehicle manufacturer, Beijing Automotive Group (BAIC) together with the Industrial Development Corporation (IDC), recently held a media briefing on the progress of the construction of its vehicle manufacturing plant to be established in the city.
It will be the first new car plant to be built in South Africa in 40 years and is expected to build 50 000 vehicles a year by 2022. BAIC will be the major shareholder, holding 65% of the venture and the IDC will hold the remaining 35%.
Speaking at the briefing, BAIC SA senior representative Sun Tongli said the vehicle assembly plant, which will be implemented in two phases, will comprise an assembly shop, paint shop, office block, energy centre and sewage treatment works.
“The first phase will have installed capacity to assemble up to 50 000 units per annum. This number is expected to double at full capacity in the second phase,” he said.
He added that phase one is anticipated to be completed in the second quarter of next year.
Around two-thirds of the production is earmarked for the export market and the vehicles will include passenger cars, sport utility vehicles, light commercial vehicles and pick-ups both for domestic and export markets.
“One of the keystones of the project is to include the community of Nelson Mandela Bay and the surrounding areas, Uhambiso consultant managing director George Gerber noted. He further said that the project is aimed at creating approximately 800 direct jobs.
“More than 35% of the R800 million building works budget has been allocated to SMMEs to ensure meaningful and impactful participation of SMMEs.
Project contractor Beijing Industrial Designing and Researching Institute (BIDR) said 80 to 85% of the procurement value for the civil building works will be from SA companies and 15 to 30% of the procurement value for the plant will be from local suppliers.
“BAIC has set a target of 60% local content for the vehicles to roll off the Coega assembly line, while the parts will be sourced from new and existing component manufacturers in SA,” he said.
He added that plans for the vehicle plant also include the future construction of a supplier park in the Coega IDZ to facilitate parts supply.
Construction is several months behind schedule, mainly due to contractor and labour disputes.
“Although the market is tough in South Africa, we do foresee the regional Southern African Development Community market picking up in due course,” IDC regional manager, Kingsley Dell-Robertson remarked.
The plant will be located on 47.3 ha of land under a covered area of 88 969 m2.
SMMEs are encouraged to register on the BIDR procurement database on www.app.bidr.co.za. Tenders are published on www.bidrsouthafrica.co.za.