Tau bemoans lack of progress in meeting auto master plan’s local-content goal
Trade, Industry and Competition Minister Parks Tau has acknowledged the pressure that domestic automotive component manufacturers are facing from imports, energy and logistics costs and weaker demand and has indicated that government will prioritise efforts aimed at “keeping this base alive”.
Addressing the South African Auto Week under way in Durban, Tau highlighted the lack of progress in meeting the South African Automotive Master Plan’s goal of achieving local content of 60% by 2035, with the local content in vehicles built in South Africa standing at 38.1% in 2025.
“Last year, our vehicle manufacturers imported R151-billion-worth of original equipment components,” he said, while noting that ownership in the component sector remained concentrated and largely foreign-owned.
Linking localisation directly with transformation, Tau added that black-owned suppliers too often remained at the edge of the supply chain.
“And some component manufacturers, black-owned and otherwise, are under real pressure from imports, energy and logistics costs, and weaker demand. Some have closed. We cannot speak about transformation without also speaking about keeping this base alive,” he said.
Tau reasserted the significance of the current review of the Automotive Production and Development Programme 2 in supporting localisation.
“I have been clear that the programme must reward manufacturing in South Africa, not assembly alone, and must support component manufacturers.”
Government was also backing, together with Egypt and Algeria, the Africa Automotive Pact through the Association of African Automotive Manufacturers, which Tau said could give life to the African Continental Free Trade Area Agreement and to support the development of African Tier 1 component suppliers.
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