South \u200bAfrica will stop providing policy support for automakers that import near-complete vehicles for local assembly, Trade, \u200cIndustry and Competition Minister Parks Tau said on Thursday, as the government overhauls the programme that underpins the country’s car industry.<\/p>\n
Speaking at South African Auto Week, Tau said the government had agreed to phase out existing operations that rely on importing vehicle bodies and most of their \u200bcomponents in kit form \u2014 a process known as semi knocked-down, or SKD, assembly \u2014 and would not provide policy \u200bsupport for new facilities.<\/p>\n
The shift is designed to push manufacturers toward deeper local production and \u2060sourcing. The South African Automotive Master Plan aims to raise local content to 60% from the current average of 38%, \u200bdouble employment in the sector and increase South Africa’s share of global vehicle output to 1% by 2035.<\/p>\n
The change will \u200bnot apply to medium and heavy commercial vehicles, Tau said. Authorities will also tighten the legal definition of what qualifies as complete knock-down, or CKD, manufacturing \u2014 in which a vehicle is built from the ground up using locally sourced parts.<\/p>\n
Tau also said the government would investigate whether \u200badditional support was needed for South Africa’s “ladder-frame” light commercial vehicle segment, which includes pickup trucks. The minister said he would \u200binstruct the country’s International Trade Administration Commission (ITAC), which imposes import tariffs, to conduct an investigation before making a final determination on the \u200cmatter.<\/p>\n
“There was \u2060also alignment that any additional protection should be accompanied by reciprocal commitments relating to production, localisation, employment, transformation, exports, and investment,” he added.<\/p>\n
The government is reviewing the Automotive Production and Development Programme, the incentive framework for the sector, together with industry body NAAMSA, component manufacturers’ association NAACAM and organised labour.<\/p>\n
The review follows calls from automakers for incentive and policy changes that \u200bwould favour deeper manufacturing activity \u200band protect local producers from \u2060imports. Earlier this year, BMW Group South Africa CEO Peter van Binsbergen said the industry had urged the government to close what he described as an SKD “loophole.”<\/p>\n
“SKD manufacturers are coming \u200bin close to duty-free because they’re using aftermarket categories to import the engine duty-free, for \u200bexample, and they’re \u2060actually having a very easy time here in South Africa without creating any investments and hardly creating any jobs,” van Binsbergen said.<\/p>\n
Toyota South Africa Motors CEO Andrew Kirby said in July that the country’s automotive sector had evolved beyond the need for \u2060SKD operations \u200band warned that assembling vehicles from kits risked undermining larger investments in \u200bfull-scale production.<\/p>\n
“So our strong request is that we phase out SKD in South Africa and that we strengthen the competitiveness of CKD, so that we \u200bcan have a better balance between locally produced vehicles and imported vehicles,” Kirby said.<\/p>\n","protected":false},"excerpt":{"rendered":"
South \u200bAfrica will stop providing policy support for automakers that import near-complete vehicles for local assembly, Trade, \u200cIndustry and Competition Minister Parks Tau said on Thursday, as the government overhauls the programme that underpins the country’s car industry. Speaking at South African Auto Week, Tau said the government had agreed to phase out existing operations […]<\/p>\n","protected":false},"author":6,"featured_media":17813,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":5,"jnews-multi-image_gallery":[],"jnews_single_post":{"subtitle":"","format":"standard","override":[{"template":"1","parallax":"1","fullscreen":"1","layout":"right-sidebar","sidebar":"default-sidebar","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"top","share_float_style":"share-monocrhome","show_featured":"1","show_post_meta":"1","show_post_author_image":"1","show_post_date":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_reading_time":"0","post_reading_time_wpm":"300","post_calculate_word_method":"str_word_count","show_zoom_button":"0","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"1","show_comment_section":"1","number_popup_post":"1","show_post_related":"1","show_inline_post_related":"1"}],"image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post_position":"meta","trending_post_label":"Trending","sponsored_post_label":"Sponsored by","disable_ad":"0"},"jnews_primary_category":[],"jnews_social_meta":[],"jnews_override_counter":{"view_counter_number":"0","share_counter_number":"0","like_counter_number":"0","dislike_counter_number":"0"},"footnotes":""},"categories":[32,2362,30],"tags":[122],"class_list":["post-22301","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","category-featured","category-southern-africa","tag-south-africa"],"_links":{"self":[{"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/posts\/22301","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/comments?post=22301"}],"version-history":[{"count":1,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/posts\/22301\/revisions"}],"predecessor-version":[{"id":22302,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/posts\/22301\/revisions\/22302"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/media\/17813"}],"wp:attachment":[{"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/media?parent=22301"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/categories?post=22301"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/qiraatafrican.com\/en\/wp-json\/wp\/v2\/tags?post=22301"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}