Sumitomo Rubber South Africa (SRSA) has started the second phase of its R2-billion investment programme to upgrade and expand its tyre manufacturing plant in Ladysmith, KwaZulu-Natal.
SRSA manufactures passenger and commercial vehicle tyres, in particular under the Dunlop brand.
Plans for expansion of the Ladysmith plant started in 2014, with R1.1-billion allocated by parent company Sumitomo Rubber Industries (SRI), in Japan, for the initial expansion phase.
This phase focused on upgrading and modernising the plant, in order to increase the output of passenger and sports utility vehicle (SUV) tyres.
New SUV tyre models were also introduced to the manufacturing line, in response to market demand for these models in South Africa and other African markets.
The R910-million Phase 2 expansion project will introduce truck and bus tyres to the manu- facturing line.
This Dunlop branded product line is currently imported into South Africa from SRI plants in Japan and China, owing to the lack of suitable manufacturing capacity locally.
The new investment will terminate this importation arrangement.
Work on Phase 2 will be completed in the middle of 2018.
The investment in the plant has been made possible, in part, through a grant from the South African government.
The Department of Trade and Industry approved SRSA’s application for a support grant of around R300-million toward the roll-out of Phase 1, under the Automotive Investment Scheme.
It is also hoped that trade agreements will strengthen the company’s export activity into key African areas.
Local government also played a role in facilitating the expansion programme, as a tract of land adjacent to the existing plant, required for the project, was donated to SRSA by the Emnambithi Ladysmith municipality.
“Our investment underscores the confidence of our company’s foreign owners in South Africa as a buoyant investment-grade destination,” says SRSA CEO Riaz Haffejee.
“It reaffirms what is possible when government and industry work together in pursuit of mutually beneficial economic and industrial objectives.”
The employment spin-offs of Phase 1 are already visible, adds Haffejee.
“Employment levels are already being increased. The first of nearly 120 new emplo- yees have already been recruited, and Phase 2 will attract a further 300, lifting the Ladysmith plant to over 1 200 employees on completion of the second investment phase.”
The company currently employs 1 180 people, 900 of whom are employed at the Ladysmith plant.
SRSA does not divulge production statistics.