Volkswagen’s team in South Africa has done what it can to overcome what VW AG’s CEO of Passenger Cars Brand, Thomas Schäfer, called an "uphill battle", and ultimately the South African government needs to step up to solve the problems.
These strong words and warning about the future of the company's operations in South Africa were made against the background of the situation of the manufacturer’s plants in Europe. Issues regarding high costs and low productivity in Europe make Volkswagen’s cars uncompetitive, according to news reports. This will lead to staff reductions in Europe as part of a savings programme it was announced.
About the current situation in South Africa, Thomas said during a visit to the country that the German automaker has been in South Africa for nearly 80 years. “Factors like competitive labour costs once placed it among the company's higher-ranking bases globally.
“But the cost of debilitating power outages caused by chronic production shortfalls at state-owned utility, Eskom, as well as rising labour costs and logjams on railways and at ports have eroded that advantage.
“Eventually you have to say, why are we building cars in a less competitive factory somewhere far away from the real market where the consumption is? I'm very worried about it... We are not in the business of running a charity," he says.
Volkswagen produced some 132 200 Polo and Vivo models at its South African facility in Kariega (formerly Uitenhage) last year, most of them for the export market.
Those export markets are now at risk of disappearing as wealthy countries move to electric vehicles (EVs). The European Union and Britain are planning to ban the sale of new internal combustion vehicles from 2035.
Thomas said there were no current plans to introduce EV manufacturing in South Africa, since electric cars are currently priced out of the reach of most domestic consumers. Producing them for export would not be environmentally sustainable.
“However, with the proper government policies aimed at leveraging the country's proximity to critical minerals like lithium and cobalt, it could become a battery-manufacturing hub. There is a realistic chance that South Africa, with enough focus, with all the raw materials in the neighbourhood, could be a champion," Thomas says.
Volvo Car South Africa (VCSA) is closing Transport Month with a historic milestone in electric mobility: the EX30 Cross Country has become the first fully electric vehicle (BEV) to successfully ascend Sani Pass, one of South Africa’s most iconic and demanding mountain routes.
The name tells the story – Basadi Automotive Group. Basadi, the Sesotho word for women, was chosen by a woman who, against all odds but with an unwavering belief in God, decided in 2018 or so to go it alone in the male-dominated automotive industry.
Stellantis has announced a new collaboration with NVIDIA, Uber Technologies Inc and Foxconn to explore the joint development and future deployment of *Level 4 (driverless) autonomous vehicles for robotaxi services worldwide.
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I always do like seeing other people dance in their cars. It's one of the things that makes me happy.
Ariel Gore
Stellantis has announced a new collaboration with NVIDIA, Uber Technologies Inc and Foxconn to explore the joint development and future deployment of *Level 4 (driverless) autonomous vehicles for robotaxi services worldwide.
BAIC South Africa has confirmed that the all-new BAIC B30 SUV will be assembled locally at the company’s Coega facility in Gqeberha. This step, says BAIC, marks another significant step in the brand’s long-term commitment to the South African market.
Messe Frankfurt expands its roster of shows with a Festival of Motoring in Australia and industry shows in Jakarta and Azerbaijan.
