Asian auto manufacturers Gonow and Tata have confirmed their intentions to establish manufacturing plants in South Africa, while Hyundai South Africa considers investing in East London’s proposed multi-vehicle assembly plant.
China’s Zheigang Gonow Auto has appointed Vermillion Holdings as its distributor for Southern Africa and pledged US$10 million (roughly R72 million) to build an assembly plant by 2013. Gonow originally came to South Africa in 2007 as an empowerment subsidiary of the Boston Super Group but went into liquidation in October of last year.
Gonow currently exports to 80 countries and has already established three plants outside China: Egypt, Iran and Thailand. The company is now looking to establish further assembly plants in South America and South Africa. The company has yet to decide where to establish its new facility, citing Durban and Pretoria as potential locations, but Vermillion Holding already claims to have invested R20 million in Gonow’s local operation and created 50 jobs outside its dealer network.
In addition to vehicle manufacturing, Gonow’s South African operation will also import Meiya vehicles which had previously been brought to our markets by the McCarthy Group but were withdrawn in 2008.
Indian auto manufacturer Tata has also confirmed the establishment of a plant to assemble small- and medium-sized trucks in South Africa. The company intends to commence its operation in the 2010/2011 financial year. Tata views South Africa as its largest export market with a total of 439 units sold here in May alone.
East London’s proposed multi-brand vehicle assembly plant has caught the attention of Hyundai South Africa. The facility, which will work on the principle of several manufacturers sharing paint plant, body shop, trim and assembly lines, has been identified by Hyundai boss Alan Ross as a possible means of saving Hyundai 27 per cent in import duties. Involvement in the facility would, however, require the company to produce 20 000 vehicles from one model line to make such an operation viable.
In 2009, Hyundai has seen considerable growth in markets such as the US (90 percent), China (88 percent) and the UK (102 percent) with a 45 percent increase in its combined passenger car/LCV market over the last five years.
Ross has also announced that Hyundai will expand its range of commercial vehicles by importing 4- and 8-ton trucks to our market to complement such models as the H1 panel van, 2,5- and 3,5-ton trucks and the H100 load carrier. To meet this expansion, the company is also giving considering the establishment of a dedicated network of commercial vehicle dealerships as well as an independent commercial vehicle head office.