No demand for local locomotives

The economic downturn has had a dramatic impact on Transnet’s wagon procurement programme and ripple effects on local component manufacturers.

Black industrialists who were set up specifically to supply Transnet have been particularly hard hit by the plunge in orders from the parastatal.

Transnet Engineering CEO Thamsanqa Jiyane told Parliament’s trade and industry committee on Tuesday that in the 2016/17 financial year only 100 wagons were built compared with the 4‚119 originally targeted. The previous year only 2‚100 wagons were manufactured compared with the 3‚692 projected.

Jiyane explained that Transnet Engineering only entered into wagon building contracts when this was required by demand for them. As the economy slumped‚ so demand for cargo transport declined. Customers asked that no more wagons be manufactured as there was no need for them.

"The reduction in demand for wagons translated into low demand for the components related to these long-term contracts entered into. This has negatively impacted on anticipated localisation deliverables‚" Jiyane said.

Transnet and the Passenger Rail Agency of SA were called before the committee to report on the localisation taking place related to their major infrastructure investment projects.

Jiyane reported that in relation to the 1‚064 locomotive acquisition programme‚ R4bn had been spent locally to date compared with the R21‚8bn target.

He said that to date 269 of the 1‚064 locomotives had been accepted from two of the original equipment manufacturers at Koedoespoort in Pretoria.

ANC MP Adrian Williams said he was skeptical about the information provided as on site visits undertaken by the committee indicated that no localisation was taking place.

"Quite frankly I don't believe you. I think you are coming here and talking nonsense‚" said Williams.