Thomas Schäfer Raises Concerns About South African Factory

Volkswagen’s top executive overseeing global passenger car operations, Thomas Schäfer, has raised serious concerns regarding the sustainability of the German automaker’s presence in South Africa.

Volkswagen

Image: Volkswagen

The CEO highlighted that while the South African factory was once a top performer for Volkswagen globally due to competitive labour costs, various challenges now jeopardize its future.

Schäfer emphasised that issues such as load-shedding, escalating labour expenses, delays in rail transportation, and bottlenecks at South African ports have eroded the advantages the factory once held. Expressing worry about continuing production in a less competitive location distant from major consumer markets, he stated firmly, “We’re not in the business of charity.”

Image: Volkswagen

The CEO acknowledged the efforts of Volkswagen South Africa employees in mitigating these problems but stressed the need for the South African government to step up and resolve these issues. Last year, the Eastern Cape plant manufactured over 132 000 Polo models, primarily for export to 38 international markets. VWSA directly employs nearly 4 000 South Africans and supports around 50 000 more throughout the value chain.

Despite implementing measures to tackle the country’s power crisis, such as real-time load management and investing in 2.3 MW of solar capacity, challenges persist, including water scarcity. VWSA attempted to address this by installing a 200-kilolitre rainwater capturing system for the engine plant.

Image: Volkswagen

Related: Volkswagen South Africa and DHL join forces to showcase the all-electric ID. Buzz in SA

In a pointed comment directed at the government, Schäfer remarked, “There’s a realistic chance that South Africa, with enough focus, with all the raw materials in the neighbourhood, they could be a champion.” The potential closure or scaling down of Volkswagen’s operations in South Africa would represent a significant loss for the country. The VW Kariega plant, operating for over 70 years, holds historical significance and contributes substantially to the economy by providing employment and supporting numerous individuals within the broader supply chain.

2023 Polo

Image: Volkswagen

Schäfer’s concerns underscore the urgent need for resolving critical infrastructure challenges facing South Africa. The outcome of these issues could determine whether the country continues to remain an attractive hub for global manufacturing or risks losing crucial investments and employment opportunities.

Visit our listing page and browse thousands of new and used vehicles with CARmag

The post Thomas Schäfer Raises Concerns About South African Factory appeared first on CAR Magazine.


The Car Guide

Comments

Post a Comment

Popular posts from this blog

Topical tips on buying used – Chapter 1

Image
Buying a used car can be harrowing, whether privately or from a dealer. Here are some tips, as well as some things to watch out for. Beware of low mileages, especially on smaller or cheaper cars. It is always possible that the odometer has been turned back. Some things to bear in mind are:- diesels are often bought because they the driver needs to undertake long trips without consuming vast amounts of fuel. This could be a sales rep, or someone travelling large distances to work, lots of lengthy trip for family holidays, etc. So, usually higher mileages than normal. An expensive or luxury car may not see much time on the road, but very seldom a “workhorse”. This makes the executive cars likely to have a lot more life left than the overworked and abused hatchback. These also spend most of their life in a home garage or undercover parking lot at work. Related: Someone paid more for a mint BMW 325iS Evo 2 than a used M4 A vehicle without any service history is a serious disadvantage
Read more

Top 10 Best-Selling Automotive Brands Locally – April 2024

Image
Following eight consecutive months of sales decline, the milestone of celebrating a century of vehicle production locally saw a welcomed increase in the motor industry for April 2024. Have a look at the data below, which sees Toyota drop in sales but retain the top spot, with Suzuki moving into second and Nissan dropping to the bottom of the list without the NP200 rolling off of the production line. Image: Toyota Looking for your next new or used Porsche? Find it here with CARmag! South Africa is marking 2024 as a significant year for its automotive industry, celebrating 100 years of car manufacturing. Mikel Mabasa, CEO of naamsa , the country’s automotive business council, commented, “As the sun rises on a century of automotive innovation, South Africa proudly commemorates a century of automobile manufacturing excellence. This milestone reflects a journey of resilience, ingenuity, and passion that has shaped the nation’s automotive legacy.” Details on how the industry will commem
Read more

Could this teased Lancia sports car be a reborn Stratos?

Image
Lancia recently teased a coupe-looking model, waiting to be unveiled in their Multiverse. Could this then, signify the return of a historic moniker like the Stratos to the struggling automaker? Image: Lancia #MakeLanciaGreatAgain – a social media phrase that has been making the rounds for the better part of a decade. World Rally Championship titles, Formula 1 single-seat winners and some other gems in between. The Italian automaker litters dates in history and motorsport, with some truly revolutionary ideas and models that aided their bid to become one of the most successful motorsport manufacturers of all time. But that is all in the past. Lancia now contends sole markets with a platform-shared model but there have been ambitious plans under Stellantis ownership to kick-start the automaker and make them great again… words that delight so many enthusiasts and aficionados. Related: Automobili Amos debut Martini Racing Livery Lancia Delta and Safarista What better way to do this th
Read more