President Cyril Ramaphosa said the investment commitment by Ford and Meair Investments reflects long-term confidence in South Africa as a key link in the global automotive value chain.
On Tuesday, President Ramaphosa officiated at the launch of Hesto Harnesses, a subsidiary of Meair Investments, in Kwadukuza, KwaZulu-Natal, a state-of-the-art 35,000-square-meter manufacturing facility.
Hesto Harnesses has partnered with Yazaki Corporation to produce wiring harnesses and instrument panels for South Africa-based automotive original equipment manufacturers (OEMs) Toyota, Isuzu, Nissan and Ford.
The President was impressed by the grand opening of the Metel R500m auto parts manufacturing plant.
“I’ve never been walking on the factory floor like this morning and I’ve been so impressed by the tremendous enthusiasm on the faces of the workers. Not only the enthusiastic faces and people I saw, 70% of them were women, All are so beautiful.
“The rejuvenation and cohesion of the people who work here. Just seeing the people here makes me happy. It’s a great showcase of what Hesto has done and what we’ve achieved here,” the president said .
The president said the reindustrialisation of the South African economy was a key pillar of the economic reconstruction and recovery plan.
He said the government had several industrial policy measures in place and was implementing far-reaching reforms to unlock growth opportunities in priority industries.
This includes the automotive industry and extends to areas such as apparel and textiles, chemicals and plastics, steel and metal manufacturing, green industries, the digital economy, and networked industries such as energy and transportation.
Referring to the concept of localization, President Ramaphosa said that the government will continue to promote localization as the domestic industry shifts to electric and other new energy vehicle assembly platforms.
“Wherever we’ve gone in advancing the concept of localization, we’ve seen a very positive response from industry players, and I would like to thank you for the positive response to localization, where I see localization efforts.
“I was also impressed to hear how much you focus on localization, by attracting a certain percentage of workers from around the factory, which brings communities together with the company. As we move localization efforts to Various other platforms, we are moving towards the goals that we have set for ourselves,” the president said.
He added that he understands that Meair is both a supplier and a business partner to auto assemblers, and that the company has been a driving force in achieving localization goals.
Through these efforts, the company has secured several contracts from Ford South Africa to support its production expansion strategy in South Africa, he said.
The President stressed that South Africa’s automotive industry is one of the biggest beneficiaries of foreign direct investment in the country.
Despite all the challenges, 2021 will be a big year for auto investment.
“We need to work together to unlock new business opportunities, transformation and job creation in the parts manufacturing sector in South Africa, just as we need to foster new investments in technology and skills. This is why the localisation rate in the vehicle production development plan The goal is to reach 60 percent by 2035,” he said.
The President reiterated that South Africa remains one of Africa’s preferred investment destinations and an important gateway to markets and other business opportunities across the continent.
He said that the African Continental Free Trade Area will further open up opportunities for the development of export markets, the expansion of industrial bases and the expansion of regional value chains.
“The South African economy has the potential to achieve a higher growth trajectory by unlocking competitive advantages in key economic sectors. Our role as government is to create an enabling environment for such businesses to flourish. We are working to implement institutional and governance reforms to support Continued recovery in business and investor confidence,” he said.
Create job opportunies
The President reiterated that unemployment remains one of the biggest challenges affecting individual livelihoods, family well-being and social development.
“As such, the facility will create over 4,000 jobs, which will translate into a monthly injection of R30 million in wages and payroll expenses into the iLembe district, which is significant and most welcome,” the president said.
The benefits of the investment will also be felt by maintenance, catering and other service providers who will be contracted to support those operations, he said.
The President highlighted the strong skills development mandate implemented in the Meair stables, including a new multi-million rand bursary and apprenticeship training scheme.
“Happily, there is a strong focus on female candidates, in fact, Hesto Harnesses is primarily driven by women, with 70 per cent of its staff being women,” he said.
President Ramaphosa commended the Minister of Trade, Industry and Competition Ibrahim Patel, the Governor of KwaZulu-Natal, the Mayors of Nomusa Dube-Ncube, Illembe and KwaDukuza and iNkosi uDube and his team for their Contributions made to bring the project to fruition.
Like many other projects in the auto industry, the project was made possible because of the policy certainty created by the auto master plan and the auto production and development plan, he said.
“In this project, we have shown that we can build and rebuild together. We applaud Ford for the confidence it has shown in this major investment. We also applaud the partnership between Hesto and the Japanese company Yazaki,” the president said.