Automaker’s R1,2bn investment in next gen bakkie hailed

13 November 2019 | Web Article Number: ME201917137

Automotive
Government & Municipal
Import / Export
Manufacturing
Automaker’s R1,2bn investment in next gen bakkie hailed
Minister of Trade and Industry Ebrahim Patel, left, shakes hands with Michael Sacke, Isuzu Motors South Africa, Chief Executive Officer and Managing Director

ISUZU Motors of Japan confirmed this week that it will be investing R1.2 billion into the next generation bakkie programme in South Africa, while an additional total local content value of R2.8 billion will be generated through the lifecycle of the programme.

This milestone development follows Isuzu’s take over last year of the company's light commercial vehicle operations as well as the balance of shareholding in the trucks business. This decision saved 1000 direct jobs most of them at the Port Elizabeth manufacturing plant, as well as 4000 jobs through its dealer network and many more through its base of 430 suppliers in South Africa.

Current plans are to grow the company’s annual bakkie production to 29 000 units per annum, said Yoichi Masuda, Senior Executive Officer for Isuzu Motors Limited and Chairman of the Isuzu Motors South Africa Board.

“Our decision to invest in the production of the next generation bakkie in South Africa demonstrates our commitment to this market. This is further reinforced by the fact that this operation is the bakkie and truck manufacturing and distribution operation which is 100% owned Isuzu operation outside of Japan.”

Masuda emphasised the important role the government’s Automotive Production and Development Programme plays in providing predictability and stability for investors when making long-term business decisions.

“We fully support the requirements of the extended APDP and are working on various initiatives to ensure that we contribute to the achievement of the South African Automotive Master Plan aspirational targets over the coming years. Furthermore, I would like to acknowledge the instrumental role the South African government has played in enabling us to successfully operate in this market since January 2018,” he said.

Minister of Trade and Industry Ebrahim Patel welcomed the announcement saying it would contribute immensely towards President Cyril Ramaphosa’s investment drive.

“This investment shows confidence in the South African economy’s growth potential and will help to secure more than 1000 direct jobs at the plant. The South African Automotive Master Plan, developed in partnership between government and industry, provides a good basis for companies to plan and gives policy certainty on which investment decisions can be made,” Patel said.

Norio Maruyama, Japan’s Ambassador to South Africa, hailed Isuzu’s investment decision as a concrete follow up action to the South Africa Investment Conference which was held last week. “This is also an encouraging step towards the achievement of the objectives which were announced earlier this year at the TICAD 7 in Yokohama, Japan.”

South Africa will initially serve as the main market for the next generation bakkies but with growing volumes expected to be generated from the roll-out of its Sub-Saharan Africa growth strategy, which will be geared at further strengthening its position in key markets as well as its overall distribution footprint.

“The next generation bakkie will be locally engineered to meet the requirements of the South African and key Sub-Saharan Africa markets.” said Michael Sacke, CEO and Managing Director of Isuzu Motors South Africa. “Our customers have come to know our vehicles for their reliability, durability and flexibility and it is important that we continue to build on these strengths.”

Isuzu’s biggest markets in Sub-Saharan Africa currently include Kenya, Zimbabwe, Zambia, Mozambique, Mauritius, Senegal, Ghana and Ivory Coast. Last year the company’s sales in these markets increased by 17% versus the prior year.

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