An African free trade agreement (FTA) is one of the most important FTAs the local automotive industry required the South African government to negotiate and sign, says Toyota South Africa Motors (TSAM) president and CEO Dr Johan van Zyl.

He says that any such FTA has to include the North African countries of Algeria, Egypt, Libya, Tunisia and Morocco.

Combined, these markets, despite their current political instability, comprise 800 000 new vehicles a year, “which is a big market”.

“If we don’t have an FTA which includes these North African countries, we will have a problem,” notes Van Zyl.

“They are currently talking to Europe about implementing an FTA by 2020, which will make it very difficult to sell South African vehicles there. These countries will disappear as market opportunities for the local automotive industry.

“An African free trade area will create a massive market with massive potential.”

TSAM exports the locally manufactured Corolla, Hilux and Fortuner models into Africa, while other local producers, such as Nissan South Africa, General Motors South Africa and Ford Motor Company of Southern Africa, also exported vehicles to the rest of the continent.

Recent rumours about a new model being added to TSAM’s production line-up appear to be true.
The company looks set to produce another passenger car model at its Durban plant, adding to the 2014 Corolla, which required a R1-billion investment into the 220 000 unit-a-year-capacity plant.

The local arm of the Japanese manufacturer is also building a new truck plant in Durban. In addition to this, TSAM will move from current semi-knockdown assembly of the Ses’fikile minibus taxi to completely knockdown assembly, with much more local value-add, by 2015.

Toyota assembles and sells the Hino truck brand in South Africa, as well as the luxury Lexus brand.

TSAM expects to produce 175 000 units at its Durban operations this year.