Name and Location
Automotive investment projects, South Africa.

Client
BMW South Africa (BMW SA), Ford Motor Company of Southern Africa (FMCSA) and Volkswagen South Africa Group (VWSA).

Project Description
BMW SA, FMCSA and VWSA are undertaking multibillion-rand investment programmes to increase capacity at their respective assembly plants.

BMW plans to invest R6-billion at its Rosslyn plant, in Pretoria, Gauteng, to enable the plant to produce the next-generation BMW X3, which will be sold locally and exported to various countries. Production of the next-generation BMW X3 will replace the BMW 3 Series sedan, which will be allocated to other plants in the global BMW production network. The BMW Spartanburg plant, in the US state of South Carolina, will continue to produce the next-generation BMW X3.

The investment to build a completely new model at the Rosslyn plant requires the installation of new technology on the production line; lifting the roof to accommodate production of the X3, which is bulkier and longer, compared with the 3 Series; a revamp of the paint shop; establishing a new technical training centre and information technology backup centre; and building a new bodyshop.

The realignment of production at Rosslyn is in response to the continuing growth of the sports-utility vehicle (SUV) segment worldwide.

FMCSA plans to expand its Silverton assembly plant, in Pretoria, to produce the new Ford Everest SUV, along with the new Ford Ranger that was launched at the end of 2015. The all-new Ford Everest is a seven-seater SUV, featuring body-on-frame construction, intelligent four-wheel drive and an Advanced Terrain Management System to help navigate challenging terrain with ease.

The plant will feature state-of-the-art automation using Ford’s global manufacturing processes and will be equipped to produce 10 000 Everest SUVs a year.
South African-produced models will be sold locally and exported to markets across sub-Saharan Africa.

The investment will enable Ford to increase volumes and expand the Everest range to eight derivatives across a broader price range. It will enable customers across sub-Saharan Africa to choose from two powerful engines equipped with robust six-speed automatic or manual transmissions.

VWSA plans to upgrade and expand its Uitenhage plant to produce two new models for the local and export markets. One of the new models that will be produced is the new-generation Polo Vivo. The other new model has not yet been confirmed.

Both models will use VW’s small car Modular Transverse Matrix platform, which is used to build various models – from a Saveiro half-ton pick-up to a small SUV – and feature new technologies and driver-assistance systems.

The investment will also result in the Uitenhage operation moving from a predominantly right-hand-drive market to one also producing left-hand-drive vehicles in significant numbers.

With this investment, the plant will increase its capacity from the current 120 000 vehicles a year to 160 000 vehicles a year. A possible third model might also be built at the plant.

Value
BMW SA plans to invest more than R3-billion in new state-of-the-art facilities and operations at the plant, and an additional R3-billion will be invested in suppliers, launch costs and the  training of associates.

FMCSA plans to spend R2.5-billion on its investment programme.

VWSA plans to invest more than R4.5-billion in its investment plan, which will include more than R3-billion in production facilities, about R1.5-billion in local supplier capacity and a further estimated R22-million for the development and training of employees.

Duration
A timeframe for BMW SA’s project has not been disclosed.

Production of FMSCA’s new range started in October 2016.

Production of VWSA’s two new models are expected to start in 2017, as the current models reach the end of their life cycle.

Latest Developments
BMW SA has started the construction of a new bodyshop at its Rosslyn plant. At 26 000 m², the new bodyshop will be almost 50% bigger than the current one. There will also be an increase of 50% in the number of robots used at the facility, at about 300 units.

The group has acquired a site of about 33 000 m² adjacent to the plant for the new building.

The bodyshop is being built by Stefanutti Stocks.

The building will be handed over to BMW SA in the first half of next year.

The Rosslyn plant’s old bodyshop will become a logistics area.

Key Contracts and Suppliers
For BMW SA: Stefanutti Stocks (bodyshop construction).

On Budget and on Time?
Not stated.

Contact Details for Project Information
BMW SA GM group communications, Diederik Reitsma, tel +27 12 522 2525 or email diederik.reitsma@bmw.co.za. FMCSA, Alisea Chetty, tel +2712 842 2707 or email achetty2@ford.com.

VWSA spokesperson Matt Gennrich, tel +27 11 911 2789, fax +27 11 911 2700 or email gennrich@vwsa.co.za.
For BMW SA: Stefanutti Stocks, tel +27 11 571 4300, fax +27 11 571 4370 or email holdings@stefstocks.com.