Mercedes-Benz Cars has invested €600m (R10bn) to expand its East London manufacturing plant to make next generation C-Class vehicles, mostly for export, including the new Mercedes-AMG high-performance range.
This is the largest single vehicle investment by a foreign original equipment manufacturer (OEM), says Nico Vermeulen, director of the National Association of Automobile Manufacturers of SA.
Mercedes announced the investment on Tuesday during a visit to the factory by President Cyril Ramaphosa. The president has set up a team to help attract $100bn (R1.2-trillion) in investments into the country over the next five years.
Ramaphosa says this cash injection signals a positive momentum in the target to raise R1.2 trillion in new investment for South Africa.
“This investment is a statement of trust, a statement of confidence that South Africa is indeed a good investment destination and we welcome you for having brought this investment here.”
The investment includes the construction of a new paint shop and a new body shop, an upgrade of the assembly shop and new logistics warehouses. Overall, the new buildings add about 65% more space to existing buildings for passenger vehicle production.
Member of Mercedes-Benz’s divisional board, Markus Schafer: “This is an important milestone for Mercedes-Benz, especially for Mercedes-Benz South Africa today and I think a very important milestone for the community, expanding the plant and making the plant ready for the future. This is a sign of trust in the fantastic work force. The investment is also a sign of our commitment to SA and efforts to revive economic growth as well as the socioeconomic development of the East London region,” he said.
SA makes more than 600,000 passenger and light commercial vehicles a year with state support through the Automotive Production and Development Programme. The East London plant currently produces about 110,000 C-Class vehicles a year, of which more than 90% are exported.
Source: Business Live & Eyewitness News