The announcement that port charges for manufactured goods, including cars, would be dropped was “definitely a move in the right direction”, said BMW South Africa MD Bodo Donauer on Monday.
Speaking to Engineering News Online at the official reopening of the BMW Rosslyn plant, he, however, also expressed the hope that this reduction would be implemented sooner rather than later, as it had already taken the automotive industry a long period of active campaigning to reach this point.
Minister of Economic Development Ebrahim Patel noted at the event that President Jacob Zuma had announced in his State of the Nation Address earlier this month that an agreement between Transnet and the Ports Regulator had been reached to reduce port charges for manufactured goods by R1-billion this year.
BMW South Africa currently paid R645 in port charges - including 2012 inflation, and before any possible savings - to export one 3 Series, and double that to import any other model.
The local arm of the German company aimed to export 85% of its more than 90 000-units-a-year production in 2013.
“These port costs are significantly higher than in other competitor markets,” said Donauer.
He added that “more needs to happen in terms of infrastructure in South Africa. We need investment in rail, roads and ports, but this is a step in the right direction”.
The next point on government’s agenda to ease vehicle exports from South Africa should be the materialisation of Transnet’s promise to invest in new vehicle-specific wagons, said Donauer.
Patel noted at the BMW plant reopening that the South African government would, over the coming years, strengthen the logistics and transport corridors between the country’s main industrial hubs to “improve access to ports and export facilities”, in order “to sustain and facilitate growth in exports”.
He said Cabinet had already established a Presidential Infrastructure Coordinating Commission – the PICC – to drive and support the roll-out of infrastructure.
“To this end significant investment in port, rail and road infrastructure will be developed. The resultant infrastructure will reduce transport and logistical costs to BMW and other manufacturers, making South Africa a more competitive investment destination.”