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TOYOTA ANNOUNCES FURTHER INVESTMENT IN ITS HIACE SES’FIKILE PLANT

Date: 09 Oct 2019 Author Type: Press Release
Author: Toyota South Africa
Source: Toyota South Africa
  • Enhanced Local Value Addition
  • Ongoing Investment
  • Safe2School, Safe2Home
  • Hilux KD packs to Kenya
Toyota South Africa Motors (TSAM) is proud to announce that it has made substantial enhancements to the local production of its popular Hiace Ses’fikile model, by increasing the local value addition. This was facilitated by a R454 million investment in the bespoke production facility in Durban. The announcement was made by Andrew Kirby, President and CEO of TSAM, at the historic occasion attended by various industry stakeholders and dignitaries – including the Minister of Trade, Industry and Competition, Ebrahim Patel.

“In terms of the South African Automotive Masterplan (SAAM), local automotive value addition needs to be exponentially increased. TSAM is committed to support the SAAM and has therefore proactively increased the local value addition of the Hiace Ses’fikile from 38% to 44%. This localization has added R422 million per annum local value addition to the economy. Even more encouraging is the fact that we’ve been able to create an additional 80 jobs in the process.” says Kirby.

“The latest contribution places TSAM’s total investment in the Hiace Plant at over R1 billion since our initial investment in 2012. In 2012 TSAM switched from importing the Hiace Taxi as a Complete Built up (CBU) to a Semi Knock-down (SKD) vehicle, and in 2015 to a Complete Knock-down (CKD).Since the introduction of the local manufacture of this product we have seen the volumes increase from 9 300 units to 14 000 units per year, which equated to an increase of 37%. The most recent increase in demand from our customers to 15 000 units per annum has given us this opportunity to deepen our localization, which will allow us to improve affordability over time.

“This investment of nearly half a billion rand by TSAM is another major vote of confidence in the capability of the South African automotive industry and the KwaZulu-Natal economy. Manufacturing is the largest contributor to economic output in the province, supporting more than 350 000 direct jobs.

“Since TSAM’s localization programme began, more than 80 000 taxis have been assembled locally by Toyota. If each of those taxis opened their doors to commuters right now, more than a million South Africans would be able to climb in. The increased level of local content is an important part of the 2035 vision for the industry and will increase the participation of more South Africans in this thriving sector of the economy,” says Patel.

According to Kirby: “The minibus taxi industry plays a pivotal role within the South African transport system, and as such, is important in supporting the wheels of our economy. TSAM is proud to be a part of this Industry and is continually looking for opportunities to participate in Social upliftment programmes. Today we would like to highlight two of these programmes that have a direct bearing on minibus taxi commuters and those who operate them.

“The first of these is the Safe2School, Safe2Home project focusing on improving the safe transport of learners traveling by minibus taxis to school. This initiative is one that I am personally passionate about, in that the Taxi owners, drivers, parents and teachers will be better educated on road safety. This initiative, together with the eThekweni Transport Authority and Global Road Safety Partnership (South Africa), will impact 120 taxi drivers and operators within 24 schools and approximately 6 800 learners.

“We have a tailor-made Taxi Education Programme, with the expressed aim of empowering taxi operators by providing them with business, leadership and entrepreneurial skills.” About 600 taxi operators nationwide have already participated, with 645 planned over the next two years.”

TSAM also announced the start of its export operations to support local assembly of Hilux in Kenya. TSAM is embracing the direction of local assembly, and has therefore invested close to R20 million for the establishment of its packing plant to support this knockdown business. The essence of manufacturing as intended under Automotive Production and Development Programme (APDP) remains intact. There is no change to the value addition and employment has, however, with employment increasing by 20 additional people. Start of production in Kenya will be later in October 2019 and customers in Kenya will benefit by being able to buy their vehicles at a more competitive price.

TSAM is committed to the growth of the automotive industry and as such will continue its contribution to the social and economic development of Africa as a whole.