By Kagiso Bonoko
South Africa continues to be the most preferred location for multinational investors in Africa. This is made more evident by the continued investment by international companies in the country.
The growth of the automotive sector in South Africa demonstrates this potential. It is a tangible showcase of the commitment of local and international investors, with the support of government policies and programmes, can achieve great returns, while contributing significantly to the South African economy.
A number of the world’s leading auto manufacturers, like BMW, Volkswagen, Mercedes-Benz, General Motors, Ford, Toyota, Nissan, and others, continue to expand their presence in the country with increased investment.
On August 22nd, 2024, the newly appointed Minister of Trade, Industry and Competition, Mr. Parks Tau, presided over the announcement of a groundbreaking R1.175 billion partnership between Toyota South Africa Motors and Ogihara South Africa, at the Dube TradePort Special Economic Zone in Durban.
Minister Tau praised this venture: “it is a critical step towards advancing South Africa’s localisation strategy within the automotive industry, which aligns with the South African Automotive Masterplan objectives. This joint venture is set to deepen industrialisation, create jobs, and attract foreign direct investment into the country”.
He added; “Through this investment, the companies have committed to increasing the number of jobs, and I am told that this is expected to create 250 new jobs directly, with a further 1040 indirect jobs across the value chain. Additionally, the investment will target small and medium enterprises development, with a strong focus on empowering women and youth. As government, we express our full support for this remarkable advancement and affirm our collective commitment to making South Africa the preferred investment destination.”
This follows Volkswagen’s recent investment to expand its Kariega plant in the Eastern Cape in preparation for the production of a new vehicle model expected to roll off the assembly line in 2027. This investment is expected to secure the livelihoods of approximately 3,500 workers and support an additional estimated 50,000 indirect jobs and opportunities.
The newly established Ogihara production facility, based at the Dube TradePort, will significantly enhance local automotive manufacturing. The plant will increase the local content of popular Toyota models such as the Hilux, Fortuner, and Corolla, in line with the localisation targets of SAAM, aiming for 60% by 2035.
The Dube TradePort Special Economic Zone, located in the KwaZulu-Natal province, is seen as one of the sound locations for South Africa’s manufacturing sector.
The Toyota and Ogihara joint venture is expected to create substantial employment opportunities, further boosting the local economy while strengthening South Africa’s position as a key player in global automotive.
