Ford to invest R1.5bn in SA

30 January 2008

Ford Motor Company of Southern Africa (FMCSA) has announced plans to invest more than R1.5-billion to expand its operations in South Africa for the production of Ford’s next-generation compact pickup truck and Puma diesel engine.

The local arm of the US car giant said in a statement on Wednesday that the new investment would start in 2009 and be split between its assembly plant in Silverton, Pretoria and engine facility in Struandale, Port Elizabeth.

Production of the new diesel engine is scheduled to begin in 2010, followed by production of the new pickup in 2011.

FMCSA said the investment would increase annual production at its Silverton plant to 110 000 units, with approximately three-quarters of the vehicles being produced for export, primarily to markets in Africa and Europe.

Its Struandale engine plant, meanwhile, will increase annual production for its turbocharged common-rail Puma diesel engine and components to about 180 000 units, with the majority also being exported.

The investment and new manufacturing contract would “transform FMCSA’s current production landscape to enhance South Africa’s significance as a strategic export base for vehicles, engines and components for Ford Motor Company,” the firm said.

FMCSA chief executive Hal Feder said that winning the investment “highlights our strategic position within the future global footprint of Ford Motor Company. It also underscores Ford’s ongoing commitment to expanding our operations in South Africa.”

As part of the investment, FMSCA said it would continue working with the South African government to accelerate the development of the industry’s current and future workforce.

FMCSA currently has nearly 4 500 employees between its two manufacturing facilities, and expects to hire up to 500 additional employees by the time the realigned production kicks off in 2011.

Local suppliers stand to benefit from FMCSA’s expanded capacity, as more local content is sourced to meet the new production and output. “FMCSA currently achieves about 35% local content, which will improve to more than 60% when production begins,” the company said.

“Working with roughly 110 different South African suppliers, annual spending on local components will increase from an estimated R441-million each year to approximately R2.9-billion.”

FMCSA, a wholly owned subsidiary of Ford Motor Company, first set up operations in South Africa in 1923.

SAinfo reporter

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