Mar 13, 2009
Ambitious local-content goal set by Japanese auto groupBack
Africa|Nissan Europe|Nissan SA|Nissan South Africa|Systems|Africa|Japan|Exhaust Systems|Systems|Vehicle Manufacturer|Dave Cameron|Koss R-200 Consumer Headphones|R1
© Reuse this
He says the company will start by investigating the substitution of high-volume parts – with the associated high shipping costs from Japan – and high-value parts, “with lots of duty on them”, with local parts.
Cameron says his Japanese parent company has advised him to accelerate the search for local content, in an attempt to drive costs down.
This should provide a faint glimmer of hope to the local component manufacturing industry, currently staggering under the weight of the global credit crunch, and the subsequent sharp drop in vehicle sales.
“There is, for example, the opportunity for Nissan to source its exhaust systems locally,” notes Cameron, currently on a three-year secondment from Nissan Europe.
“Often chassis parts can be produced locally. “The development has already been done overseas, and this can now be transferred to local companies.”
Cameron says the biggest limitation in increasing local content is the cost competitive-ness of local suppliers compared with Thai, Eastern European and South American parts suppliers.
The weakening rand has aided South African component suppliers in this department in recent months, but local parts are still 20% to 30% more expensive (ex works) than those churned out by their Thai counterparts.
“Before the rand weakened, this difference was 40%,” says Cameron.
Nissan SA hopes to produce 45 000 vehicles at its Rosslyn plant this year.
In the 2007 financial year, Nissan SA spent around R1-billion on locally made parts, the same amount on local services, support and capital, and R200-million on local materials.
“If we are able to increase the local content to an average 60%, then we are effectively upping our allocation for local business by R500-million,” states Cameron.
Nissan SA currently has around 120 suppliers.
Edited by: Martin Zhuwakinyu© Reuse this Comment Guidelines
Other Automotive News
Updated 3 hours ago More than a third (35%) of current car owners who are considering purchasing a new car in the near future, say they will possibly purchase a different car brand to the one they have, this according to a study by Ipsos. A third of car owners are undecided on the matter.
Updated 3 hours ago As vehicles become increasingly technologically advanced, the future of the automotive industry is shifting towards the ‘connected car’ that can communicate with external sources, such as the vehicle manufacturer, says mobile network service provider Vodacom...
Updated 3 hours ago Swedish vehicle manufacturer Volvo Car Group’s new XC90 sports utility vehicle (SUV) will offer an unrivalled combination of power and efficiency with a dual engine, when the CX90 is revealed later this year.
Recent Research Reports
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
Real Economy Insight: Steel 2014 (PDF Report)
This four-page brief covers key developments in the steel industry over the past 12 months. It provides an overview of the global and South African steel and stainless steel markets, South Africa’s major steel producers and events that have shaped these markets.
This Week's Magazine
Updated 3 hours ago Multinational semiconductor chipmaker corporation Intel announced its national campaign to further acquire partners to drive its She Will Connect programme, an initiative that aims to expand digital literacy skills to young women in developing countries, further into...
Updated 3 hours ago South Africa's MeerKAT radio telescope array programme should get back on schedule within a few months. This assurance has been given by SKA South Africa (SKA SA) associate director: science and technology Prof Justin Jonas. Early last month, Science and Technology...
Updated 3 hours ago The Passenger Rail Agency of South Africa’s (PRASA’s) Metrorail service will remain a subsidised service following its current multibillion-rand rolling stock, station, depot and signalling upgrade programme. PRASA group CEO Lucky Montana has allayed fears that...
Updated 3 hours ago The uncertainties around the remediation of affected areas as addressed in the Contaminated Land Provisions in the National Environmental Management: Waste Act No 59 of 2008 will possibly spark litigation and disputes between landowners and businesses, contractors...
Updated 3 hours ago South Africa is currently the largest component of the African Development Bank’s (AfDB’s) active portfolio in Southern Africa, comprising 62.5% of the bank’s $7.9-billion exposure to the 12-country region – the second largest beneficiary is Mauritius, which...