Toyota South Africa Motors (TSAM) now assembles the Toyota Ses’fikile at its Prospecton plant in Durban.
On Friday Minister of Trade and Industry Dr Rob Davies attended the official function, which signalled the finalisation of long discussions between TSAM, Toyota Motor Corporation in Japan and the South African government.
The Ses’fikile will be assembled from semi-knocked down kits which will be imported from Japan, but some localisation has already been achieved.
Dr Johan van Zyl, President and CEO of TSAM and Managing Officer at Toyota Motor Corporation, told Moneyweb the localisation level of the current assembled Ses’fikile will be about 21% to 22% with components like batteries procured locally.
The minibus will be assembled on a dedicated line at Prospecton with an initial investment of R70m for this first phase of the project.
The investment created 90 direct jobs at the plant, but Van Zyl said that with upstream and downstream suppliers and service providers it has resulted in 210 more jobs. “If you look at the investment to job creation ratio, you can see it is a very positive one, which makes this product a good one for further investment,” he said.
The Ses’fikile is not only important for the national taxi industry, it is also a major volume seller for Toyota in South Africa.
“With this in mind it makes economic sense to localise the assembly of this product and reap the benefits of increased investment, job creation and possible downstream supplier development,” says Dr Van Zyl.
Dti pushing local manufacture
Davies told Moneyweb that after the predecessor of the Ses’fikile and Quantum, the Hi-Ace stopped in 2007, all the vehicles used for taxi transport were imported.
“For example in 2009, 280 000 minibuses were registered in South Africa; very few of those were manufactured locally. We want to encourage manufacturers in South Africa to resume the local manufacture of this very important class of vehicles in the country. It can form part of our larger Industrialisation Policy Action Plan,” he said.
Davies also indicated that although the rules and regulations for the Automotive Production and Development Plan (APDP) set to kick off next year, have been published for passenger vehicles, the department is still busy completing a study to see how the plan can be expanded to include medium and heavy commercial vehicles.
In phase two of the project, after all the rules and regulations of the APDP and government’s taxi programme have been finalised, Toyota South Africa Motors will look at ways to further localise content, Van Zyl said.
The Ses’fikile is specifically adapted to meet all the requirements set by government for the local taxi industry.
Currently the Ses’fikile will be exported to Swaziland, Namibia, Botswana and Lesotho, Van Zyl said. Current production is 40 units a day, with the bulk of the approximately 1 000 units per month going to supply the South African market.
The hope is later to manufacture the Quantum for possible export to other countries.
Davies said that government hopes that investment by automotive companies will continue in South Africa, as well as strengthen and deepen.
He told Moneyweb that during a recent trip to Japan he met with 16 CEOs of Japanese companies who were all interested in finding out how to get involved in South Africa.