Nissan is to invest more than R1 billion in South Africa to double the production capacity at its Rosslyn assembly plant to 100 000 units a year and for the production of a new one-ton pick-up for the domestic and export markets.

The investment was expected to create about 800 new direct jobs within Nissan South Africa (Nissan SA) and about 4 000 jobs in its supply chain, its managing director, Mike Whitfield, said yesterday.

Production of the pick-up was scheduled to start in late 2014 but it was too early to talk about actual planned production volumes for the new model, he said.

The investment announcement coincided with a visit to South Africa by Toshiyuki Shiga, the chief operating officer of the Nissan Motor Company of Japan.

Shiga said that the capacity expansion in South Africa was important for Nissan’s global strategy because Nissan Motor Company had an ambitious global growth plan.

He added that global markets were pivotal to Nissan’s growth strategy and emerging markets were a key focus, none more so than the African continent.

Whitfield said Africa was regarded as a huge opportunity by vehicle manufacturers because it had about 16 percent of the world’s population but accounted for only just more than 1 percent of total industry new vehicle volumes.

The growth in vehicle sales was expected to come out of North Africa and South Africa, he added.

The investment by Nissan (is) set to firmly establish South Africa as a global base for the production of pick-ups, with Toyota, Ford, Nissan and Isuzu all producing products in the country for both the domestic and global export markets.

Whitfield said more than 400 000 pick-ups should be produced in South Africa annually in the next three to four years.

“This is not too dissimilar to what happened in Thailand, which built its production base based on pick-ups,” he said.

Whitfield said the Automotive Production and Development Programme (APDP), which replaces the Motor Industry Development Programme from next year, was a big driver of the investment and rise in capacity.

The APDP has a minimum annual production threshold of 50 000 units to qualify for incentives and benefits.

Whitfield said another target with the new pick-up, which was also in line with the APDP, was to increase local content, excluding the drive train, from 50 percent in the current pick-up to 70 percent with the new model.

He confirmed Nissan SA would not be able to achieve its 70 percent local content target using its existing suppliers and it was already actively involved in discussions to bring additional suppliers to South Africa.

But Whitfield said it was too early to comment on who these suppliers were.

Shiga said Nissan’s six-year global mid-term business plan, Nissan Power 88, incorporated two key objectives: increasing its market share to 8 percent by 2016 from 5.8 percent in 2010 and its corporate operating profit to 8 percent from 6.1 percent in the same period.

Nissan was aiming to grow its global sales by 10.4 percent to 5.35 million units in its financial year to March next year and its global market share to 6.7 percent from 6.4 percent, despite overall industry growth of 5.3 percent to 79.7 million units expected in this period, Shiga said.

 

Source: http://www.iol.co.za