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Ford Motor Company investment project, South Africa – update

Image of new Ford Ranger

Photo by Ford Motor Company of Southern Africa

25th November 2022

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor

     

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Name of the Project
Ford Motor Company investment project.

Location
Pretoria, in Gauteng, South Africa.

Project Owner/s
Ford Motor Company, through its Ford Motor Company Southern Africa (FMCSA) subsidiary.

Project Description
The investment project is one of the biggest-ever investments in the South African automotive industry.

The investment will increase the capacity at the Silverton plant from 168 000 to 200 000 vehicles a year, supporting the production of the new Ford Ranger pickup truck for the domestic market and exports to more than 100 global markets. The plant will also manufacture Volkswagen (VW) pickup trucks as part of the Ford-VW strategic alliance.

The project will entail extensive upgrades to the Silverton plant, which will increase production volume and drive significant improvements in production efficiency and vehicle quality. These include the construction of a new body shop with the latest robotic technology, and a new high-tech stamping plant, both of which will be located on site for the first time.

The plant will use a high-speed line to produce all the major sheet metal components for the new Ranger. It includes a fully automated storage and retrieval system for stamping dies, which will be housed in the roof of the facility, thus eliminating related labour-intensive processes. In addition, a modern blue-light scanner system, which scans surfaces for imperfections, will ensure that the highest-quality final product leaves the stamping plant.

Extensive upgrades will also be undertaken on the box line, paint shop and final assembly to improve vehicle flow within the plant, along with the expansion of the container and vehicle yards.

Ford will also build new-vehicle-modification and training centres – the latter will ensure that all Ford employees are equipped with the knowledge and skills required to maximise the efficiencies of the enhanced Silverton facilities.

The new investment programme builds on the Project Blue Oval renewable-energy project, which aligns with the company’s global target of using 100% locally sourced renewable energy for all its manufacturing plants by 2035, and achieving carbon neutrality by 2050.

The first phase of Project Blue Oval is under way with the construction of solar carports for 4 200 vehicles at the Silverton plant.

Potential Job Creation
The expanded plant has added 1 200 new jobs for a third shift to support increased production volumes. This takes the workforce at Ford South Africa to 5 500 employees. 

Ford’s supplier network has benefitted too, with about 10 000 jobs added across the value chain.

Capital Expenditure
$1.05-billion (R15.8-billion – 2021).

The investment includes $686-million, or R10.3-billion (2021), for extensive upgrades to the Silverton assembly plant, which will increase production volume and drive significant improvements in production efficiency and vehicle quality. Ford will also invest $365-million (R5.5-billion – 2021) to upgrade tooling at the company’s major supplier factories.

Planned Start/End Date
Ford SA will produce the new-generation Ranger pickup at the Tshwane plant in 2022.

Latest Developments
The first new Ranger ­– Job 1 – has been assembled at Ford’s Silverton plant.

Ford now has three production hubs in its International Markets Group (IMG)  producing the new Ranger – the Silverton plant and two plants in Thailand. 

The Pretoria plant will, however, not realise its full production volume next year, as the single cab will enter production only around April.

Currently, only the Volkswagen Amarok and Ranger double cabs are being produced at the plant.

IMG operations director Andrea Cavallaro is positive, however, that the facility should be able to reach 150 000 units in 2023, as “demand is pretty hot”.

He has warned, though, that Europe is expected to face tough economic conditions next year, and that this will most likely dampen the automotive market there.

“That will have an impact on what we produce here, but we are still sketchy on what that impact will be . . . ” Cavallaro has noted.

Ford will also have to weigh all its global production options, as Europe has unexpectedly pulled forward the introduction of Euro VII emission standards to 2025.

The much stricter standard has the potential to greatly impact on South Africa’s new-vehicle exports to Europe, as Europe is the country’s single-biggest export market.

Cavallaro has emphasised that Silverton will have to deliver a sustained quality assembly effort going forward, as will the operation’s component suppliers.

As for the continued loadshedding the South African manufacturing sector is forced to face, Cavallaro has said that Ford’s manufacturing operations in Pretoria and Port Elizabeth appear to be cushioned from the effects of Stages 1 to 4, but not Stage 5 and onwards.

Therefore, Ford is progressing with its plans to reach grid independency by 2025, with some concerted planning to achieve this expected in the next 12 months.

A first phase of solar power, already implemented, will be followed by a second stage, which should address about 35% to 40% of Silverton’s energy needs.

Phase 2 will also include battery solutions, as the plant now runs 24 h/d in a three-shift operation. The next phases will consider other renewable sources such as biogas.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
FMCSA GM communications Minesh Bhagaloo, tel +27 12 842 2691 or email mbhagalo@ford.com.

Edited by Creamer Media Reporter

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