GMSA unveils R900m local investment

29 January 2010

Confident that the worst is over for the local auto industry, General Motors South Africa is to invest around R900-million on upgrading and consolidating its production facilities in Port Elizabeth, and on launching 10 new products, over the next three years.

Production of Isuzu bakkies has been shifted from Kempston Road to the Struandale plant, which also produces the Opel Corsa utility vehicle. The Struandale plant was named the best local manufacturing plant for light commercial vehicles in the latest 2009 Synovate Quality Awards.

“This is indicative of our efforts to produce the best quality products in the industry which ultimately supports our competitiveness as a vehicle assembler in South Africa,” GMSA’s finance vice-president, Michael Sacke, said in a statement this week.

‘Quality products, customer satisfaction’

Later this year, the company will open its state of the art Pan African Parts Distribution Centre at the Coega Industrial Development Zone outside Port Elizabeth. The centre, an investment of R250-million, will replace the existing GMSA facility in Kempston Road.

The new facility of 38 000 square metres will house all of the company’s aftersales operations under one roof, and aims to meet the needs of the growing parts and accessories business which has an annual revenue of in excess of R1-billion.

Sacke said that like most original equipment manufacturers in South Africa, GMSA was an independent entity which had to fund its own investments.

“It is important for us to continue improving our production facilities as this contributes to the quality of our products that we produce,” he said, adding that it was vital for GMSA to focus on quality products and excellent customer satisfaction which helps to maintain the current customer base and lure new ones.

Marginally higher sales

GMSA is forecasting that new vehicle sales in 2010 will be marginally higher than last year.

According to GMSA sales and marketing vice-president Malcolm Gauld, the company is confident that the market will not further deteriorate this year. “We foresee a gradual improvement in sales and project that the 2010 market will come in at 412 000, about a 5% growth versus 2009’s 394 000,” said Gauld.

He pointed out, however, that there was no doubt that consumers were still facing challenging economic upheaval with steep the rise in food and commodity prices.

“We are mindful that the pending increase in electricity prices can adversely affect cost of living which will curb consumer spending confidence,” he said.

SAinfo reporter

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