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Toyota South Africa Motors Ground-breaking, ground-shaking investment

30.05.2016

Just over R6.1-billion. That's the equivalent of around 29,117 Toyota Hiluxes (presuming you opt for the entry-level 2.0 VVTi version).

It's also what Toyota has just sunk into the local production of the new Hilux and Fortuner. And as I write this I'm test-driving a Hilux 2.8 GD-6  Double Cab 4x4 Raider automatic, and can confirm that it's everything the faithful might have expected. And then some. Ditto the Fortuner which I've just spent a week with.

The official investment announcement was made last week at a really posh event at Toyota South Africa Motors' plant in Prospecton, with Jacob Zuma in residence, along with not one but two ministers. Dr Rob Davies, Minister of Trade and Industry, and Ebrahim Patel, Minister of Economic Development. Plus, of course, a massive entourage, and a battalion of security.

Now this gargantuan R6.1-billion investment is a very big deal indeed, and besides echoing epic confidence in this country, it means that by June when production of the Hilux and Fortuner hit peak, some 140,000 a year will be rolling off the local assembly line. That's around 80 percent of TSAM's total production volume, bearing in mind that besides these two models, the Corolla, Corolla Quest, and Quantum are also built at Prospecton.

Importantly, too, while the previous Hilux and Fortuner had about 1,500 local parts, the new models have 2,700. Which helps hugely with the localisation of manufacturing.

"This latest announcement gives evidence of a company that is defiantly committed to South Africa by strategically investing in the people, tools and equipment to produce cars and commercial vehicles of world-class standard that are not only destined for the domestic market, but will also fly our flag high on the international stage thanks to a robust export plan," TSAM President and CEO Andrew Kirby said.

"But it is in fact more than that - it's also a celebration of the pivotal role that both Hilux and Fortuner play in the overall development of the South African motor industry."

And speaking of export, a little over half of TSAM's 2016 Hilux and Fortuner production will find homes in places such as Europe, Latin America, and Africa, with Africa being an export market that Toyota hopes to grow.

But while all these numbers might seem huge, SA really is just a minnow on the automotive global scene.

"Although we are justifiably proud of the achievements of the motor industry in growing production and especially exports post-1994, we must remember that South Africa currently produces less than one percent of the 90-million vehicles made worldwide each year," as Dr Johan van Zyl, Chairman of Toyota South Africa and Chief Managing Officer of Toyota Motors Europe, pointed out.

"We have to remain world competitive not only in terms of wages and productivity, but also regarding labour stability.  I cannot stress enough the importance of engagement - engage, engage and engage again - the need to employ dispute resolution as the first and ultimately only line of defense rather than resorting to strike action as the solution.

"Nevertheless I am confident that a fair and equitable labour agreement can be reached and rest assured, that no matter what, Toyota will do its utmost to continue to put its customers and South Africa first."

And sitting in the session where this announcement was made, before a tour of the Hilux and Fortuner production lines, it was hard to not feel a little quiver of pride for both SA, and at Toyota's massive investment.

Article written by James Siddall
30.05.2016
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