CAPE TOWN - FORD Motor Corporation (FMC) yesterday said it would invest $1.05 billion (about R15.8bn) to expand its Ford Ranger assembly facility in Silverton, Tshwane, the biggest investment by the US group in 97 years of operation in this country.
FMC International Marketing Group Operations director Andrew Cavallaro said the investment would turn the Silverton plant, already one of the largest of Ford's production hubs outside of the US, into a state-ofthe-art production facility, and which would play an important role in Ford's global operations.
Production capacity would be expanded to 200 000 vehicles a year from 168 000 currently, and its vehicles would be exported to more than 100 countries, while an estimated 60 000 new job opportunities would arise out of the investment and also from the expanded production capacity requirements of FMC's local component suppliers.
“This ticks off another 1 percent of the $100bn that President Cyril Ramaphosa said was his targeted foreign direct investment over five years from 2018,” said Cavallaro.
The investment includes funds for a new body shop, a new sheet-metal stamping facility, and investments in motor components supplier factories to be established in the Tshwane Automotive Special Economic Zone, adjacent to the assembly plant.
Extensive upgrades would also be made to the box line, paint shop and final assembly to improve vehicle flow within the plant, along with the expansion of the container and vehicle yards. New vehicle modification and training centres were planned.
“Ranger is one of our highest volume, most successful global vehicles.
This investment will equip our team with the tools and facilities to deliver the best Ford Ranger ever, in higher numbers and with superior quality,” said Cavallaro.
Ford announced the investment at a briefing attended by President Cyril Ramaphosa, Trade, Industry and Competition Minister Ebrahim Patel, Department of Public Enterprise Minister Pravin Gordhan, Gauteng Premier David Makhura, Tshwane mayor Randall Williams, and senior Ford executives.
Through this investment, Ford's Silverton plant was expected to generate revenues exceeding 1.1 percent of South Africa's gross domestic product.
The investment would also build on the recently announced Blue Oval renewables energy project, which aligns with the company's global target of using 100 percent locally sourced renewable energy for all its manufacturing plants by 2035 and achieving carbon neutrality by 2050.
The first phase of Project Blue Oval already was under way with the construction of solar carports for 4 200 vehicles at the Silverton plant.
“Our aim is to achieve ‘Island Mode', taking the Silverton plant completely off the grid, becoming entirely energy self-sufficient and carbon neutral by 2024,” Cavallaro said.
“It will be one of the very first Ford plants anywhere in the world to achieve this status,” he said.
A new Ford-owned and operated chassis line would also be built in the special economic zone for the new vehicle programme, said Ford Motor Company of Southern Africa Operations vice-president Ockert Berry.
“This will reduce logistics costs and complexity, improve efficiency and allow us to build more Rangers,” he said. Ford was also working closely with all spheres of the government and relevant state-owned entities, such as Transnet, to develop the Gauteng-Eastern Cape High Capacity Rail Freight Corridor.
The aim was for this rail line to be a full-service line linking the Silverton assembly plant and the Tshwane special economic zone with Port Elizabeth, which is home to Ford's Struandale engine plant and the Coega Special Economic Zone.
The corridor would channel all of Ford's inbound and outbound logistics through Port Elizabeth to support the higher production volumes, and the rail project was projected to create thousands of jobs within the value chain.
Ramaphosa said the investment would accelerate the industrialisation of South Africa using it's competitive advantages, including a well-developed automotive industry, second to none on the continent and South Africa's advanced manufacturing capabilities, skilled workforces, and ability to offer new markets to investors. He said the investment would help to repair some of the damage done to the economy and confidence that was caused by the Covid-19 pandemic.
“We cannot forever operate as an island. The world has opened up. We have to be part of that and have to show we can compete with the rest of the world. Foreign investment does not only bring in money, but new skills and technology and that's why it's valuable,” he said.