tshwanes automotive sector a catalyst for south africas manufacturing recovery

COVID 19 has had a devastating effect on economies across the globe but has had an even more telling effect on developing economies such as South Africa’s.

Before the COVID 19 economic carnage, the automotive sector had already been identified as a key sector in the efforts to accelerate economic growth in South Africa.  According to Delloite, South Africa’s automotive sector accounted for 6.8% of gross domestic product (GDP) in 2018 and the auto industry accounts for a significant chunk of South Africa’s entire manufacturing capacity with the broader automotive sector employing  457 000 people. The sector was showing positive growth with 386 863 vehicles exported from South Africa – an annual record. The exporting of passenger cars increased by a strong 17.7% in 2019.

TASEZ will grow the city’s already impressive automotive sector that already employs in the region of 80 000 workers and hosts global companies such as BMW, Ford Motor Company, Nissan, TATA and IVECO. It will include amongst other facilities,  an incubation centre, retail facilities, innovation and technology centre, component manufacturers, warehouse and logistics, conference facilities, recreational facilities and residential buildings.

The City of Tshwane is a multi-industry city with economic activity in sectors such as aerospace and defence, business process outsourcing, tourism and agro-processing among others.  “As a City, we have a proven capacity in this and other sectors, we are home to 30 Johannesburg Stock Exchange-listed companies as well as various multinational companies and we are confident that our total investor offering that includes our well-developed science, technology, academic innovation sectors, high literacy rates, and our large concentration of financial and business services will ensure the success of TASEZ and quite importantly, will keep our country’s automotive plans on track despite the COVID 19 difficulties” continues Mogaladi.

In 2019 the President of South Africa, Cyril Ramaphosa officially launched the Tshwane Automotive Special Economic Zone (TASEZ).  Located in South Africa’s capital city, the City of Tshwane, this 162.6-hectare zone is a shared vision of South Africa’s national, provincial and local governments and offers direct and ready linkages to regional and international markets.

“The challenges brought about by COVID 19 make the success of TASEZ  and the overall resilience of the automotive sector in Tshwane even more important for the country’s economy,” says Tshwane Economic Develop Agency (TEDA) Solly Mogaladi. “TASEZ  will create employment opportunities, help accelerate transformation, socio-economic development and industry growth. It will be an effective tonic for our economy in these tough times” he continues.

The economic recovery predicted for the global economy is an indication that the automotive sector is on its way to recovery and even if the world does not rid itself of COVID19, indications are that the automotive sector will continue being an important economic driver for South Africa. Mogaladi is looking beyond just recovery. “We see Tshwane as perfectly poised for the future of the automotive industry, we don’t just make good cars for the world, we are innovators and 60% of research South Africa;’s research output comes out of Tshwane and, as the home of Africa’s automotive hub we are also looking forward to being active contributors in the design and development of the vehicles of the future.