Eastern Cape’s truck making boom

10 June 2008

Passenger cars may be the big brother of the Eastern Cape automotive manufacturing industry, but behind the scenes a bustling heavy-duty truck and bus sector is poised to take its first big strides.

The growing economy and a construction boom are only two of the driving forces pulling the commercial vehicles section out of its infancy and onto its own legs – in fact, a wrap of South Africa’s vehicle sales figures for 2007 show that commercial vehicles sales have continued to grow, while passenger vehicle sales have slumped.

Go to Eastern Cape Madiba Action This is good news for Port Elizabeth-based General Motors (GMSA) and Volkswagen (VWSA) and Mercedes-Benz (MBSA) in East London, where the province’s hard-working commercial vehicles are assembled.

Four decades of truck-building

The Eastern Cape’s oldest truck maker, Mercedes-Benz, for instance, achieved a record year, with its commercial vehicle divisions selling 8 622 units in 2007, representing an overall market share of 23.3%.

All the truck models built at the German car giant’s East London plant, including the Mercedes-Benz Axor, Freightliner and Mitsubishi FUSO ranges, are reserved for the South African market.

Mercedes-Benz spokesperson Shirle Greig says they have been assembling trucks in East London since 1962, although the company’s name has changed over the years, from Car Distributors Assembly to United Car and Diesel Distributors to Mercedes-Benz SA, and most recently to DaimlerChrysler SA.

In March 2002, Ikhwezi TruckTech took over the assembly of Mercedes-Benz’s trucks.

The first Mercedes-Benz truck built in South Africa in 1962 was the LP911, the first model in the enormously popular L-series, with its rounded lines and distinctive snub-nose.

“The LP911 had a nine-ton gross vehicle mass (GVM) with a 4.5 tonne payload, a 110 horse-power indirect injection diesel engine and at the time it was revolutionary,” says Greig. “In those days, the Mercedes-Benz truck had one of the smallest slices of the commercial vehicle market share pie, and was seen more in farmyards than in cities.”

‘Hard-working’ light commercial vehicles

The truck industry in Port Elizabeth is somewhat younger than the four decade-old Mercedes-Benz, but already General Motors SA’s hard-working light commercial vehicle lines, like the Isuzu KB and the Corsa Utility bakkies, make up most of its output.

GMSA spokesperson Denise van Huyssteen says that 74.6% of the vehicles produced by GMSA last year were light commercial vehicles while only 25.4% were passenger vehicles.

The company was indeed hard-working in 2007 and acquired a 23% share of the light commercial vehicle market in South Africa – this after they re-entered the market over the past five years.

“We launched the new Isuzu KB towards the end of 2007, and expect that in 2008 our sales of this popular car line will increase,” says Van Huyssteen.

Overall their medium and heavy commercial vehicles controlled 8.4% of the South African market share in 2007.

“We will be looking to grow this share in 2008. The trucks which we supply to this segment of the market are through our 50/50 joint venture company with Isuzu, called Isuzu Truck South Africa,” she says. “We import limited numbers of light commercial vehicles and these include the Lumina Utility and the Opel Vivaro.”

The coming year spells more hard work, and GMSA will be launching six new passenger vehicles in South Africa as well as four commercial vehicles.

Mzantsi Truck and Bus

Uitenhage-based Volkswagen South Africa’s Mzantsi Truck and Bus manufacturer started operating in January 2006 at the VWSA commercial vehicles plant.

Mzantsi is responsible for vehicle assembly, maintenance and warehouse management, while Volkswagen is responsible for quality assurance, logistics and information systems, product and process engineering and overseeing that Mzantsi performs to VW’s international standards.

Mzantsi has to date employed more than 20 new recruits, mainly from an automotive school of excellence, the Uitenhage-Despatch Development Initiative training centre, a school of excellence that is a public-private partnership promoting economic activity in the two Eastern Cape towns.

Mzantsi director and full-time production manager Vusikaya Mancapa finds his job challenging and exciting, saying the first 20 months proved to be a “quantum learning curve”.

“The name Mzantsi came up spontaneously and soon gained popularity within the group. It is an authentic Nguni name for the South, which has acquired a street-wise connotation that refers to South Africa,” Mancapa says. “Since it was the first time that Volkswagen was building trucks and buses in Southern Africa, we found the name most appropriate for this exciting venture.”

Responding to a question about the lucrativeness of their business, Mancapa said, “The expected return on our investment in Mzantsi is not lucrative in the short-to-medium term. Our hopes – as well as our profit plans – are pinned on sustained business growth in the medium to long term.”

Three bus and five truck model ranges are currently assembled at the Mzantsi plant. In its first year (2006), the company built 122 buses and no trucks, but by last year 213 new Constellation trucks were assembled and 46 buses were built.

Mzantsi Truck and Bus spokesperson Banoyolo Hlalukana says that while the manufacturing facility has remained the same in 2008, more units will be produced – approximately 600 units in total – a clear indication that their hard work to date is being rewarded by growth.

This article was first published in Eastern Cape Madiba Action, winter 2008 edition. Republished here with kind permission.