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Stellantis plant to break ground in May; Citroën key as volume brand going forward – Whitfield

30th January 2024

By: Irma Venter

Creamer Media Senior Deputy Editor

     

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Construction work on Stellantis’ assembly plant in the Coega Special Economic Zone, in the Eastern Cape, should kick off in May, says the vehicle manufacturer’s new CEO Mike Whitfield.

The start of assembly – “in a very ambitious plan” – is scheduled for the beginning of 2026.

The greenfield facility is being developed in partnership with government’s Industrial Development Corporation and the Coega Development Corporation, with the exact contributions of these institutions still a work in progress.

However, Stellantis South Africa (SA) will operate and manage the plant, emphasises Whitfield.

The R3-billion facility will build “a one-ton bakkie, as a start”.

As it stands, the Fiat Titano or Peugeot Landtrek are available as possible options within the Stellantis stable, unless a new model is unveiled.

The first phase of production will reach volumes of 50 000 units a year, but with the ability to scale up this number.

Whitfield says 40% of production will be sold in South Africa and 60% exported, mainly to the rest of Africa. 

Employment at the plant will reach more than a 1 000 people.

Local content on the one-ton bakkie will start at 30%-plus, “progressing over time”, notes Whitfield.

The Eastern Cape facility will include a bodyshop and paintshop, and, if the price tag seems a tad low compared with other automotive plant developments in South Africa, Whitfield says it is because the bodyshop will not be fully automated.

Whitfield brings to Stellantis the experience of someone who has spent significant time in the auto assembly arena.

He was the long-standing MD of Nissan SA, before moving over last year to head up Stellantis SA as he approached retirement age  – 65 – at the local arm of the Japanese car maker.

Whitfield spent 42 years at various levels within the Nissan group.

Nissan SA has a long history of assembling bakkies at its Rosslyn plant, in Tshwane, while the Coega plant will be Stellantis’ first foray into manufacturing in South Africa.

“This is something I can focus on, to try and build, to be part of the building process. If you look at it, Stellantis is very successful globally and we also need South Africa to play a significant role here. That is what attracted me to the group,” says Whitfield.

He adds that he remains positive about South Africa as an assembly destination, especially as government’s well entrenched automotive policy provides the certainty required for international vehicle manufacturers to set up shop in the country.

Dealership Restructuring
It doesn’t take a maths wizard to know that Stellantis has a bit of a mountain to climb in South Africa.

Forty per cent of 50 000 locally produced bakkies is 20 000 units. That is quite a steep target for domestic sales of one-ton pickups a month – 1 666 to be precise.

This is far more than Stellantis is currently selling in the market between the Citroën, Opel, Fiat, Peugeot, Alfa Romeo and Jeep brands combined, at between 400 and 500 units a month.

Whitfield is aware that Stellantis must build its presence in South Africa.

“We must create increased awareness of our brands and products. Stellantis is the only brand that offers access to six brands.

“It is also very important to build customer trust,” he adds. “This is the foundation of any brand.”

With ‘customer trust’, Whitfield says he is referring to the total cost of ownership.

“Are we controlling parts' pricing? Are all the parts available in order for customers to not experience downtime? Do our vehicles have good residual values?

“It is vital that we supply parts at the right price and at the right time, so customers can have peace of mind when they drive one of our vehicles.”

Part of the process to build the Stellantis brand in South Africa is to rationalise the current 50 outlets to around 37 or 38 dealerships, says Whitfield.

“Some of the 50 handle only two or three brands. Going forward, every dealership will sell and service all six brands.”

Stellantis’ Entry-level Future is Citroën
“Our volume brand going forward will be the Citroën range,” says Whitfield.

Looking at the South African new-vehicle market, between 55% and 60% of all car sales are in the band below R400 000 to R450 000.

“Our future brand that will actively participate in this segment will be Citroën,” says Whitfield. “We have a number of new products coming out in this segment in the next 12 to 18 months.”

Stellantis will also expand its light commercial vehicle (LCV) range beyond the one-ton bakkie expected to roll off the production line in 2026.

Whitfield expects Stellantis sales to grow this year – even if not dramatically – with 2026 to produce a more noticeably uptick as the new one-ton pickup enters the market.

“But you cannot jump from 5 000 units a year to 20 000 – it's a journey.

“Realistically speaking, to be relevant in this market, you need to look at a number of 2 000-unit sales or so a month.”

As for new-energy vehicles, Whitfield says the domestic sale and production of Stellantis hybrids and electric vehicles will depend on the level of government support, set to be announced later this year.

 

Edited by Creamer Media Reporter

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