Name of the Project
BAIC vehicle manufacturing plant project.

Location
The plant will be located in the Eastern Cape Industrial Development Zone (IDZ) of South Africa.

Project Owner/s
The Industrial Development Corporation (IDC) and the Beijing Automotive Group Corporation (BAIC) have signed a deal to develop the vehicle manufacturing plant.

BAIC will be the major shareholder, holding 65%, with the IDC holding 35%.

Project Description
The project entails the construction of a completely knocked-down vehicle manufacturing plant in the 50 000 ha Coega IDZ, which is linked with the Ngqura deep-water harbour, located not far from Port Elizabeth. The car manufacturer plans to export about two-thirds of its production, so access to harbours is critical.

The plant will produce passenger, multipurpose and sports-utility vehicles (SUVs), as well as bakkies, and will be rolled out in phases. The plant will have an initial capacity of producing 50 000 vehicles a year, ramping up to 100 000 units a year.

The project will be rolled out in two phases.

The first phase will have an installed capacity to manufacture 50 000 units a year and will include a body shop, a paint shop and an assembly line. It will produce small cars, small SUVs and pickups – three of the most popular vehicles in South Africa.

Phase 2 will double production to 100 000 units a year.

The project consolidates the Eastern Cape as an automotive hub, with companies, such as Volkswagen, Mercedes Benz and General Motors, already major investors in the province.

Plans for the BAIC plant include the future construction of a supplier park in the Coega IDZ to facilitate parts supply to the assembly line.

Potential Job Creation
According to data released by the Coega Development Corporation, total local labour since the start of the project amounts to 1 839 people.

The project is well on its way to exceeding 35% small, medium-sized and microenterprise (SMME) participation.

To date, the value of construction tenders allocated to SMMEs has numbered R44.1-million.

Capital Expenditure
The investment is valued at R11-billion.

Planned Start /End Date
The project broke ground in 2016.

All construction should be completed in 2020.

Latest Developments
Semi-knockdown (SKD) production is about to start at the BAIC South Africa (SA) plant in the Coega IDZ.

This first phase will involve SKD production, which is essentially to assemble a limited number of large, imported and already assembled component subsets into a completed vehicle.

SKD production will start with the X25 sports-utility vehicle and D20 small car, both launched in 2017.

Staff will be recruited, trained and upskilled during this period in preparation for full production.

The next phase will involve the construction of a 21 000 m² paint shop, which has started. This should be ready in November next year, which will enable the plant to move from SKD to completely knock-down (CKD) production.

CKD production typically involves vehicles being assembled from a larger number of smaller parts using increased local content.

The next phase will be to progress to full product manufacturing, concurrent with increased local parts content and increasing uptake of BAIC vehicles in South Africa.

A new marketing agency has been appointed to handle the BAIC brand in South Africa.

The construction of the office block, as well as the assembly hall and body shop, have been completed, with the complex having secured a certificate of occupation from the Nelson Mandela Bay municipality.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
The project is behind schedule.

Contact Details for Project Information
IDC, tel +27 11 269 3000 or fax +27 11 269 3116.
BAIC, tel +86 10 56630185 or email haojinyi@baicintl.com.