The local automotive industry is at a crossroads and the timing of the inaugural National Association of Automobile Component and Allied Manufacturers (Naacam) show, in Durban, came at a critical point for those rising to the challenge of massive policy changes and industry challenges.
Speaking at the second day of the event, on Thursday, Durban Automotive Cluster (DAC) chairperson Andrew Velleman said the post-2020 policy landscape, which involved strident debate and a “robust and transparent process”, constituting the lead-up to the Automotive Masterplan, would be an appropriate platform to strive towards ambitious, but measured goals.
“At the DAC, we are positive and ambitious about what can be achieved. The future of the automotive industry in terms of product, processes and technology will be very different from the present . . . but we cannot be passive. Some local firms are well positioned for the challenges and opportunities ahead. However, others are definitely less so and will require significant investment to remain competitive,” he said.
The DAC was established 15 years ago as a public–private partnership between the eThekwini municipality and the automotive manufacturing industry within its ambit. The latter includes over 40 companies employing about 17 000 people.
Its ongoing vision is to promote the growth and competitiveness of the KwaZulu-Natal automotive manufacturing sector and establish mutual competitive advantages to help the sector overcome generic challenges.
Commenting on the achievements of the show, Velleman said organisers had set a target of attracting the participation of five out of seven original-equipment manufacturers.
Instead, six had played an active role in addressing delegates, sharing case studies, participating in the buyer supplier meetings and exhibiting.
Large companies had also facilitated the participation of the 33 black-owned enterprises that made up the total of 181 exhibitors.
MATCHMAKING FOR LOCALISATION
However, for Velleman, one of the most important aspects of the event was the private buyer supplier meetings that run concurrently with the various presentations.
“Buyers who have identified imported components that they believe can be localised are matched with suppliers who have the associated product and process capabilities to locally produce these imported components,” he said.
Velleman believes that the 200 meetings set up ahead of the event, as well as spontaneous meetings arranged during the show, will start the development of relationships that could be realised commercially at the next model cycle or beyond.
The DAC has set a target of R50-million in localisation value from this year’s interactions.
Two other important issues covered during the Naacam show were also highlighted by Velleman. Continuous improvement which entailed reducing waste and becoming more efficient and competitive was undeniably difficult. However, every small improvement in operating practices was key to a company remaining relevant and competitive, he said.
Velleman acknowledged that the second issue, productivity, had improved, with increases being objectively measured by the DAC’s benchmark programme.
However, he warned that closer alignment between business, labour and government was needed to achieve the ever higher productivity levels required going forward.
New materials, processes and products would require ever more advanced technical skills. Rapid changes required new thinking and new partnerships to keep pace with the unfolding challenges, Velleman said.