Jul 20, 2012
SA amends incentive to help restart minibus taxi assemblyBack
DURBAN|Motors|Toyota South Africa Motors|South Africa|Toyota’s Durban Plant|Minibus Manufacturing|Motors|Safer Products|Transport|Johan Van Zyl|Motors|Philip Taaibosch|Rob Davies
© Reuse this
The investment created 90 direct jobs at Toyota and 210 jobs at suppliers and service providers, and will see the assembly of 40 taxis a day on a single shift operation, or 10 000 to 15 000 units a year.
The investment follows a request by government for TSAM to restart local production of a local minibus taxi, halted in 2007.
Trade and Industry Minister Dr Rob Davies noted at the opening of the assembly line at Toyota’s Durban plant that the investment would receive government support under the Automotive Investment Scheme (AIS), through a new mechanism that allows SKD assembly of minibus taxis to qualify for incentives.
Under normal circumstances, the AIS, which is a chapter of the new Automotive Production and Development Programme, supports only completely knockdown (CKD) assembly.
“We are amending the AIS to provide support levels to this endeavour. It will be completed in the next few weeks,” said Davies.
He noted, however, that SKD assembly would only be supported until March 2015, by which time government expects taxi assemblers to take advantage of the scheme to convert to CKD taxi assembly, which demands more localisation.
Davies said this “flexibility” is allowed in order to “kick-start” minibus manufacturing in South Africa.
He added that a local taxi assembly industry can feed vehicles into a broader African market, especially under a pending free trade agreement, still being negotiated, between 26 countries on the continent. His department is also pushing for preference to be given to locally assembled taxis under the Department of Transport’s taxi recapitalisation programme, which provides financial support to the taxi industry when replacing their vehicles with newer, safer products.
The South African registered minibus taxi industry numbered 280 000 units in 2009, with the yearly purchase of new taxis at 19 000 units in the same year, said Davies.
“Of these, fewer than 100 were made in South Africa. This was a situation we desperately needed to turn around.”
The local minibus industry contributes R30-billion to South Africa’s gross domestic product a year, transporting nine-million people.
Davies said he believed the support pro- gramme for minibus taxi assembly could secure R1-billion in investment in total, creating around 2 000 jobs.
“We would like to see other companies follow suit and bring minibus production to South Africa.”
“It really makes sense to produce it here because of its popularity.”
It is estimated that there are currently 250 000 Toyota minibus taxis operating on South Africa’s roads.
Myoli says it took 18 months to roll out the assembly line. Local content on the project is low at the start of the project, with only the starter motor, glass and the battery locally sourced.
TSAM president and CEO Dr Johan van Zyl says a second phase in the taxi project may see the assembly line incorporate other product derivatives, such as a panel van. It will also include greater local content.
South African National Taxi Council (Santaco) general secretary Philip Taaibosch notes that it has always been the council’s ambition to again see taxis assembled in South Africa, especially as it contributed to job creation.
“We must compliment Dr Van Zyl and Toyota on the decision they have made to again assemble taxis locally. We are delighted”.
Santaco has 187 000 members, buying around 35 000 new taxis a year, he noted.
Edited by: Martin Zhuwakinyu© Reuse this Comment Guidelines
Other Automotive News
Updated 5 hours ago Hino South Africa (SA) will open its new truck plant on May 21. Hino SA is a subsidiary of Toyota South Africa Motors (TSAM). The truck plant has been relocated in a R54-million investment, as TSAM required additional space for production of the Quest Corolla sedan,...
Updated 2 hours 14 minutes ago Nigeria has awarded most of its long-term oil contracts worth an estimated $40-billion a year to local companies, according to a confidential list seen by Reuters, meaning global traders need to partner with them to access crude from Africa's top producer. Global...
Updated 2 hours 31 minutes ago JSE-listed Sephaku founding member Christiaan Rudolph de Bruin has resigned as a nonexecutive director and a member of the company’s remuneration and nomination committee, effective April 21. De Bruin, along with CEO Dr Lelau Mohuba and David Twist, founded the...
Updated 2 hours 37 minutes ago The Johannesburg Stock Exchange (JSE) will start phasing out its current technology in favour of a new multi-asset integrated clearing technology platform. The JSE, which currently uses different clearing technologies for different asset classes, has partnered with...
Recent Research Reports
Steel 2014: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2014 report provides an overview of the global steel industry and particularly of South Africa’s steel sector over the past year, including details of production and consumption, as well as the country's primary carbon steel and stainless...
Projects in Progress 2014 - First Edition (PDF Report)
This publication contains insight into progress at the delayed Medupi and Kusile coal-fired projects, in Mpumalanga and Limpopo respectively, as well as at the Ingula pumped-storage scheme, which is under construction on the border between the Free State and...
Automotive 2014: A review of South Africa's automotive sector (PDF Report)
The report provides insight into the business environment, the key participants in the sector, local construction demand, geographic diversification, competition within the sector, corporate activity, skills, safety, environmental considerations and the challenges...
Construction 2014: A review of South Africa's construction sector (PDF Report)
Construction data released during 2013 hints at a halt to the decline in the industry during the last few years, with some commentators averring that the industry could be poised for recovery. However, others have urged caution, noting that the prospects for a...
Electricity 2014: A Review of South Africa's Electricity Sector (PDF Report)
This report provides an overview of the state of electricity generation and transmission in South Africa and examines electricity planning, investment in generation capacity, electricity tariffs, the role of independent power producers and demand-focused initiatives,...
Defence 2013: A review of South Africa's defence industry (PDF Report)
Creamer Media’s 2013 Defence Report examines South Africa’s defence industry, with particular focus on the key players in the sector, the innovations that have come out of the defence sector, local and export demand, South Africa’s controversial...
This Week's Magazine
The Electronic Systems Laboratory (ESL) of the Department of Electrical and Electronic Engineering at Stellenbosch University is strongly reaffirming its position as one of South Africa’s leading centres for satellite technology and expertise. It is currently...
The world’s lowest-cost diesel-electric locomotive is not made in China, but in Pretoria, at RRL Grindrod Locomotives’ newly upgraded 30 000 m2 plant. The company’s locomotive pricing is “more competitive than any other original-equipment manufacturer (OEM)...
The South African Defence Review 2012, released to the public at the end of last month (despite the year given in its title) recommends the creation of the post of Chief Defence Scientist. This official would be responsible for the management of defence technology...
AltX-listed engineering technology company Ansys has been awarded an R188-million contract by Transnet to supply integrated dashboard display systems to the freight rail utility’s locomotives. Black-owned and controlled Ansys developed the bespoke integrated system...
South Africa’s sole nuclear power station Koeberg, which is located in the Western Cape, breached a major operations milestone on April 4, which marked the thirtieth anniversary of Unit 1 having been connected to the grid. Eskom, which operates the two-unit plant,...