National Union of Metalworkers of SA (Numsa) general secretary Irvin Jim has shredded South Africa’s progress in efforts to save the country’s ailing automotive manufacturing sector, saying the sector has been overly accommodating to outside investors at its own expense.
Briefing parliament’s portfolio committee on trade, industry and competition on Tuesday, he said while the union supports Brics, “we cannot allow” the department of trade, industry and competition (DTIC) to be overly liberal in allowing India and China to dominate the local auto sector.
“There has been a hot potato about [Chinese automobile manufacturer] Chery. We are going to be consulted. We have not been consulted … The question is: what are we going to benefit from this investment? We applaud any investment, but we are keen to understand whether Chery will be taking on board any of Nissan’s suppliers.
“We are not against Brics; we are not against China. But if China is going to invest here, they must do a proper investment that we can benefit from. The DTIC must represent us properly in this regard, and we are going to engage them.”
Jim’s submission comes as Nissan exits its Rosslyn plant in Pretoria and prepares to hold discussions with Chery SA about taking over the facility. He said as things currently stand, South Africa is “under siege” from auto brands from China and India, which add no value to the local sector or the economy.
He painted a dire picture of the auto sector, which has declined in profits and haemorrhaged jobs over the years. He said investors must invest in South Africa without exploiting the local market and the companies based here.
South Africa has undergone rapid de-industrialisation, with manufacturing declining from a peak of about 24% of GDP three decades ago to about 12% today. It will take unprecedented political commitment, vibrant industry policy that responds to the current challenges and single-minded determination among all stakeholders to turn around this dire situation
— Irvin Jim, Numsa general secretary
“In 2008 about 14% of workers were employed in the manufacturing sector. By 2017 this share had declined to 11%. Whilst it can be stated that manufacturing has recovered post the Covid-19 period and is hovering around 12%, the jobs that have been created are not quality jobs. We are talking about hamburger jobs that are not paying a living wage.”
He said in the face of US President Donald Trump and his unilateral tariffs, the government must take stock of the value of trade that benefits South Africa and take measures to protect the country’s automotive sector from all exporters who threaten the local market.
“South Africa has undergone rapid de-industrialisation, with manufacturing declining from a peak of about 24% of GDP three decades ago to about 12% today. It will take unprecedented political commitment, vibrant industry policy that responds to the current challenges and single-minded determination among all stakeholders to turn around this dire situation.”
He said the instance of Goodyear, which closed its operations at the Uitenhage plant last year, was another indication of a company consolidating its production output outside of SA to sell tyres to the SA market from the outside, eroding jobs.
He called for a complete ban on the importation of tyres from outside of SA to drive production and jobs locally. He demanded that imported vehicles should also be mandated to have SA-made tyres, saying “a tyre is a tyre”.
“We are facing plant closures in the tyre sector, where we lost the Goodyear plant last year, which employed 900 workers, and Continental Tyres, now in January, has painted a bleak picture of its market outlook in the tyre sector.
“They have told us in no uncertain terms that they have a huge spare capacity, as their headcount is for the production of around 2.3-million tyres per year. However, the production allocation that has been assigned to the South African plant is only 1.7-million tyres per annum.”
He urged the government to engage the European Union to request a delay in the implementation of the Carbon Border Adjustment Mechanism, which would add a tax to carbon-intensive goods on exports destined for the regional bloc.
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