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Nov 26, 2010

German components firm opens R178m Uitenhage facility

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German parts producer Benteler has cut the ribbon on its R178-million new plant in the Nelson Mandela Bay Logistics Park, in Uitenhage.

The operation, churning out dashboard carrier panels, body parts, front and rear bumpers, and chassis parts, will employ 250 people once it reaches full production next year.

The plant supplies the Volkswagen Group South Africa (VW Group SA), which produces the new Polo for the local and export markets, and the Polo Vivo for the local market.

With around 40% space still available for future expansion, Benteler boss Hubertus Benteler says that the 130-year-old company, a fourth-generation family-owned business, will also seek to secure work from other local vehicle manufacturers, a process which will take shape over the next 2,5 to 3 years.

He adds that the new plant is number 68 for the group, with number 69 and 70 already under construction in India and China.

The Uitenhage plant saw the introduction of a country-first hot-forming line, where blank steel parts, such as the A-pillar on a car, are shaped while heated to 900 ˚C.

Benteler Automotive CEO Hein van Gerwen says that body parts are traditionally welded together, which adds weight to the vehicle.

“So, Benteler invented hot-forming. If you shape a blank while it is still hot, there is no springback.” (‘Springback’ refers to the tendency of material to partially return to its original shape when cold-worked, because of the elastic recovery of the material.)

In the end, this means that these parts are stronger, lighter and dimensionally more accurate.

Benteler says that the South African factory is unique in that the decision to invest was made in April 2009, when the recession had well and truly bared its teeth and Benteler had lost 30% of the sales it had forecast for the year.

However, he emphasises that the company believed in its South African investment on the back of strong government support for the automotive industry, a vibrant Volkswagen brand, and a strong localisation programme.

He notes, for example, that importing parts from Asia to South Africa, building a car here, and then exporting that car to Europe mean a part can spend six months on the ocean.

“Benteler is key to VW Group SA’s business strategy to increase the local content on the new Polo and the Polo Vivo to in excess of 70%,” adds VW Group SA MD David Powels.

Benteler, together with other parts manufacturers – Faurecia, Grupo Antolin, Rehau and Flex Tech – has invested more than R700-million and created more than 600 jobs in the logistics park in the past 12 months, he says.

“Importantly, this investment enables VW Group SA to manufacture in excess of 120 000 vehicles a year for both the export and domestic markets. It is exactly this level of investment that helps provide an original- equipment manufacturer (or car manufacturer), with a hedge against the threat of imports to the South African automotive manufacturing industry,” says Powels.

“Four years ago, VW Group SA commenced a R5-billion investment programme in new plant, new technologies, new product and the required people skills development. One of the fundamental pillars of this ambitious investment programme was to take local content levels from below 40% to in excess of 70%. Together with Benteler and our other suppliers, we have achieved this.”

Edited by: Martin Zhuwakinyu
Creamer Media Senior Deputy Editor
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