Motor sector job losses top 36 000
March 23, 2009
By Roy Cokayne
South Africa's automotive industry had already lost 36 000 jobs and many manufacturers were planning further retrenchments, Herman Ntlatleng, the auto and tyre sector co-ordinator for the National Union of Metalworkers of SA, said on Friday.
He said Volkswagen South Africa had retrenched 400 workers, General Motors South Africa had lost 1 000 workers, Toyota had released 800 contract workers "but still has a problem", Nissan South Africa had retrenched 200 workers and had released 92 contract workers, BMW South Africa had outsourced its parts division, which employed 200 workers, to an operator that might want to cut jobs, Mercedes-Benz South Africa had retrenched about 200 workers and Ford Motor Company of Southern Africa was retrenching 1 000 workers.
The engineering sector had lost 4 000 workers, Ntlatleng told an Automotive Industry Development Centre workshop on surviving the downturn at the Automechanika trade fair at Nasrec.
Ntlatleng said import tariffs were possibly too low, which encouraged imports, local content in vehicles was too low, manufacturers had to innovate and possibly produce tractors, as they had done a decade ago and industrial policy should reduce exports of raw materials.
Roger Pitot, executive director of the National Association of Automotive Component and Allied Manufacturers, said production volumes of members had dropped 35 percent from a year ago and a build-up in stock had forced them to restructure, which meant retrenching people.
Pitot said the component industry had 81 000 employees in September 2008 but had lost about 8 000 in the fourth quarter of 2008, most of them contract workers, and another 8 000 permanent workers in the first quarter of 2009.
"We're down to 64 000 jobs. That is a crisis," he said.
Pitot said the job losses had set the industry back years and these highly skilled people would be needed when the market recovered.
Nico Vermeulen, executive director of the National Association of Automobile Manufacturers of SA, said the downturn was probably the worst in the history of the local automotive industry. Its depth and severity had taken everyone by surprise.
He said 2 500 vehicle assembly jobs were lost last year, while 150 franchise and 200 independent dealers had closed, causing the loss of 9 500 jobs.
"Local manufacturers are re-evaluating their business plans and there is an unrelenting focus on cutting costs," Vermeulen said.
The workshop decided that two critical initiatives to deal with retrenchments were the creation of a skills databank and a recycling venture.
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