Johannesburg - BMW South Africa says it has lost the opportunity to bid for the production of a new car model for the global market, which would have created a significant number of new jobs, because of the ongoing strike in the automotive component manufacturing sector.
Guy Kilfoil, a company spokesman, said yesterday that BMW SA had been working hard to get a second model to produce at its Rosslyn plant but had “been taken off the bidding table for that model” because of the strike.
The strike in the retail motor industry, which includes automotive component manufacturers, started about a month ago and is still unresolved.
Kilfoil was unable to provide any details about the new model because it was a model that did not yet exist in BMW’s global product range.
He added that if the contract to build the new model had been awarded to BMW SA, it was likely it would have been built only in Rosslyn for markets in the rest of the world.
“It would have involved massive production for the plant and expanded our capacity dramatically. The fact that we don’t have any further capacity meant we would have had to have added a large number of jobs to produce the second model,” he added.
Johan van Zyl, the president of the National Association of Automobile Manufacturers of SA (Naamsa), warned last month that strikes in the motor industry had damaged South Africa’s status as a reliable supplier to international export markets and could negatively affect future export contracts being awarded to South African automotive manufacturers.
“Labour stability was one of the most important considerations in the decisions by multinational corporations to allocate vehicles for production in South Africa,” he said.
Kilfoil said BMW SA’s parent company in Germany would be taking a decision in the next few months on where the new model would be produced.
“There is absolutely no way BMW’s management team would increase its risk so dramatically by awarding a contract for a model that is only built in South Africa for the world when South Africa was already risky in terms of continuous supply,” he said.
Kilfoil said BMW was still committed to South Africa and would continue to look for new opportunities but would not look to expand its production until there was a more stable labour environment.
He said BMW SA had lost the production of 13 000 cars, almost 12.5 percent of its total annual production, because of the current strike and a preceding one at its own plant.
BMW had only been able to make up about 2 000 units in other plants, which meant the net effect to the group could be a loss of 10 000 units, which could be the difference between coming first or second in the premium car segment, he said.
The National Union of Metalworkers of SA (Numsa) was scheduled to respond yesterday to the latest proposal by the Retail Motor Industry Organisation to end the strike.
But Mphumzi Maqungo, Numsa’s treasurer, said report back sessions by shop stewards in some regions only took place yesterday, which meant the union was unable to convene a planned special national executive committee meeting, which would now take place today. - Business Report