Coega is the major distribution and processing hub for automotive manufacturing in Southern Africa. The custom secure areas in the IDZ mean that automotive industry investors are able to warehouse, pack, unpack and assemble vehicles or components in a custom secure zone, with the benefit of a suspension on VAT and import duties. This has a direct effect on cash flow for automotive manufacturing companies as indirect costs such as import duties, VAT and other levies only have to be paid once the vehicles or components are moved out of the Coega IDZ.
Automotive manufacturing businesses at Coega benefit from lower production, procurement and supply chain management costs by linking to the fast, reliable and modern port facilities as well as existing road, rail and air links to Southern Africa and beyond.
12 REASONS TO CHOOSE COEGA’S AUTOMOTIVE CLUSTER
- Globally competitive prices and services. Best cost solution for component manufacturers, assemblers, original equipment suppliers and auto logistics specialists wanting to invest in the Southern Hemisphere;
- In the heart of one of the world’s most diversified automotive industry zones, which includes Ford, General Motors, Goodyear, Visteon, Corning and Johnston Controls. Close proximity to VWSA and GMSA offers logistical and cost advantages.
- Established export base includes all major world markets;
- Skilled and highly productive workforce;
- Existing logistics infrastructure;
- Customised employee training programmes;
- Established support system, including training colleges, service providers, machine shops, electronics and robotic specialists;
- Duty free access to key international markets with preferential entry to European market;
- Incentives and grants to support investment through political championship and continuous cooperation between Nelson Mandela Bay Metro, Provincial and National Government and Coega.
- Purpose-built facilities.
To take advantage of opportunities in the automotive manufacturing industry, please contact Mr Gustav Meyer on:
Telephone: +27 41 403 0400
Fax: +27 41 403 0401
SHARING THE ADVANTAGES OF AN ESTABLISHED AUTOMOTIVE HUB
The Nelson Mandela Bay area including Coega IDZ is home to:
- 3 of the 8 vehicle assemblers present in South Africa
- 7 of the top 10 global component manufacturers who have invested in SA
- 3 of the 4 largest global tyre manufacturers
Coega IDZ forms the hub of a thriving automotive manufacturing industry of local and global companies that have chosen this as the optimal location in which to invest. South African’s automotive industry accounts for 7.6 % of the country’s gross domestic product. Significant investments include General Motors South Africa’s R700 million contract to manufacture the Hummer H3, and construction of Volkswagen South Africa’s R750 million paint shop is well under way.
There are currently some 400 1st and 2nd tier component suppliers to the automotive industry in South Africa, of which more than 150 are located in the industrial area around Coega IDZ.
QUAY BENEFITS FOR THE AUTOMOTIVE INDUSTRY
Coega provides a unique logistical network and access to all major world markets for both established exporters and new investors in the automotive industry, including:
- the purpose-built deep-water Ngqhurha Port serves all the world’s major vehicle assembly regions and, in addition to being a major trans-shipment hub, is a main entry and exit point for containerized components and vehicles;
- the Coega IDZ is just a short rail, road or sea journey to most of the sub-region’s main industrial areas;
- the Port of Port Elizabeth is the main exit and entry point for FBU’s (Fully Built-up Units). Deliveries are so reliable that automotive manufacturing companies like the Ford Motor Corporation of Southern Africa and Nissan use Port Elizabeth as the harbour of choice;
- automotive manufacturing companies based in the Nelson Mandela Bay Metro ship components and vehicles to countries on all continents, including: the United States of America, Russia, China, India, United Kingdom, Australia, Japan, Singapore, Germany Sweden, France, Brazil, Zambia, Botswana and Kenya;
- the world’s major logistics, shipping and transport companies have offices or representation in Nelson Mandela Bay. Logistics services include warehousing, value chain management, transport, shipping, clearing and forwarding, and courier operations;
- from Coega, most of Europe can be reached overnight, while the America’s and the East are a day away in view of regular air links via Port Elizabeth to Johannesburg/ Cape Town and to most markets in the world.
SUPPORT FOR AUTOMOTIVE SECTOR
Coega’s Human Capital Solutions unit provides access to a skilled and highly productive workforce, as well as access to customized employee training, skills support programmes and established support systems including training colleges, service providers, machine shops, electronics and robotic specialists.
IN GOOD COMPANY AT COEGA
Competitive location solutions have been provided to these local and multinational automotive industry companies within the Nelson Mandela Bay Logistics Park (NMBLP):
- Benteler Automotive (Germany)
- Faurecia Interior Systems (France)
- Flextech (SA)
- Grupo Antolin (Spain)
- Hella SA (Pty) Ltd (South African HQ)
IMPORT /EXPORT INCENTIVES BOOST THE SOUTH AFRICAN AUTOMOTIVE INDUSTRY
The South African automotive industry is an outstanding accomplishment and the South African Motor Industry Development Programme (MIDP) has been a main contributor to the success achieved. The MIDP is effectively utilised by both exporters and importers of vehicles and components. It is a system whereby distributors based in South Africa can write off import duties on passenger vehicles against credits earned for the export of vehicles and components. The MIDP promotes two-way trade and neutralises South African import duties, thereby making imports more viable in the country.
AUTOMOTIVE MANUFACTURING SUCCESS STORIES
Volkswagen South Africa
Volkswagen South Africa is a subsidiary of Volkswagen of AG. It is a company that follows the world-class quality standards that are set by their parent company, who also manage to keep abreast of technological development in motor manufacturing.
Volkswagen SA is a known leader in affordability and it achieved great success with the introduction of the Citi Chicco in 1995. Apart from exporting built-up units to overseas markets, Volkswagen SA also exports body and engine parts and catalytic converters to countries like Argentina , Spain , Belgium and Germany.
Volkswagen South Africa manufactures Golf 4, Golf 5, Golf 1 and Polo models for local and export markets. The company is actively engaged in attracting first tier and 2nd tier suppliers to locate in a 216 hectare area in the Nelson Mandela Bay Logistics Park where they can supply in a “Just In Time (JIT)/ Just in Sequence (JIS) basis into the production lines for the new VW models.
Volkswagen SA employs 6 500 people, which makes it the largest foreign employer in the country. Volkswagen SA is committed to providing South Africa with cars of exceptional quality.
VW is located in Uitenhage adjacent to the Nelson Mandela Bay Logistics Park which is managed by the Coega Development Corporation.
General Motors South Africa celebrated recently as the first Hummer H3 rolled onto its floor in the Port Elizabeth manufacturing facility. The world’s largest car manufacturer last year awarded their South African plant the contract to produce a new version of its Hummer sports utility vehicle for the global market. The left-hand drive Hummer H3, a smaller, less expensive and more fuel efficient version of the famous SUV, is being exported to Europe, the Asian Pacific region, the Middle East and Africa.
General Motors has invested R2 billion in South African operations since they returned to South Africa in 2004, and plan to spend a further R620 million on new product development and expanding and enhancing the company’s facilitates. They have already opened an off-road track on the site of the Struandale plant which will be used for testing purposes and to demonstrate the capabilities of the Hummer H3.
General Motors is situated in zone 2 in the Coega IDZ.