State-owned implementation agency, the Automotive Industry Development Centre (AIDC), last month launched construction of its new R80-million incubation centre, located at Nissan South Africa’s manufacturing facility in Rosslyn, north of Pretoria.

This would be the AIDC’s second incubation centre. The first such centre was launched at the Ford Motor Company of Southern Africa’s (FMCSA’s) manufacturing facility in Silverton.

Speaking at the sod turning event, Gauteng Premier David Makhura noted that the establishment of the 7 200 m2 facility flowed out of the province’s programme for reindustrialisation and the country’s National Development Plan.

“This is where we want to build a globally competitive automotive manufacturing hub, but it is only possible through partnerships with globally competitive manufacturers,” he said.

He highlighted that the story of the automotive industry revival in Gauteng was a “good story to tell”.

“We have built [the industry] from scratch in the most difficult period during the recessions and we have protected jobs in the automotive industry. We worked together to save jobs and ensure that there is no real substantial shutdown.

AIDC executive Dineshan Moodley added that the aim of the centre was to reduce the barriers to entry for entrepreneurs in the automotive industry.

“One of the barriers is start-up capital. There is a high level of investment that needs to be done to make a components manufacturer competitive and to enable it to participate in the value chain.

“Supplier experience is also a barrier to entry,” he said, adding that companies were often reluctant to procure the services of small- to medium-sized enterprises (SMEs) that did not have experience, but that experience could also not be gained if they were not afforded exposure.

Through the incubation centre, SMEs can gain experience, with no risk to the original-equipment manufacturer (OEM).”

Citing the success of the incubation centre at FMCSA’s premises, Moodley highlighted that a number of parts for the OEMs Ranger model was manufactured there, including the drop-in liner, a number of metal components, a bumper series, the air conditioning unit and the grill.

“Part of that vehicle is proudly South African. The Nissan incubator will not necessarily follow the same route [with regard to the components it will make],” he added.