Aug 31, 2023 Naacam Show 2023, Conference, Renai Moothilal, International Finance Corporation (IFC), Auto Industry Transformation Fund (AITF), Women in Autos,
Naacam Show 2023
The National Association of Automotive Component and Allied Manufacturers (NAACAM) held its NAACAM Show 2023 this week, in partnership with the City of Tswane and Tswane Economic Development Agency (TEDA).
Themed “Component Factories of the Future” and comprising a schedule of conference speakers and discussion panels alongside a fully subscribed exhibition hall, this bi-ennial event (the 2021 event was cancelled due to the impact of Covid) opened on Wednesday 30thAugust, with delegates and attendees being welcomed by Renai Moothilal, Executive Director of NAACAM. Moothilal highlighted the current operating environment within the industry and commented on the value chain – saying it was essentially robust, mature and well-functioning.
He gave three micro level anecdotal case studies as examples. The 1sta locally owned Tier1 company in the Eastern Cape with approximately 500 employees, that has generated US$18 million in exports. The 2nda company in KZN with 1000 employees that supplies 1 out of 7 cars produced globally with intercoolers. And the 3rdexample was a Tier1 company supplying 4 of the 7 local manufacturers.
Deon Chang, Futurist at Flux Trends and the days host commented on the ‘Radical change underway’ in our industry with the transition to NEV’s, the need for stable and reliable energy and the challenges in the logistics sector, amongst others.
The panelists for the opening discussion consisted of Irvin Jim – NUMSA, Lubin Ozoux – SATMC, Malebo Mabitjie-Thompson – DTI&C, Neale Hill – naamsa, Solly Mapaila – SACP and Ugo Frigerio – NAACAM. Discussing the “State of SA’s automotive component manufacturing sector and future prospects,’ panelists commented on the ‘African continental market’ with a population of 1,4 billion, most of whom are currently under 25 years old. Questioning how SA can take its local infrastructure and manufacturing technology to supply the emerging African market. Hill said, “Although APDP SAAM 25 is a great proponent of transition to NEV’s - Africa is not ready to be an early adopter of fuel battery NEV’s.” Ozoux focused on the African opportunity, proposing SA takes advantage of the Africa Continent Free Trade Agreement (AfCFTA). Malebo stated that government is keen to support our export market.
Agreement was unanimous on the need to address the issue of ‘Grey imports of used vehicles and components on the continent’ and stop the continent from being the dumping ground of unwanted used vehicles from Asia, Europe and North America. Stating that in order for Africa to be as competitive as India in the global automotive industry Africa needs 25 vehicle manufacturing plants on the continent.
This panel discussion was followed by a keynote address by Loren McDonald of EVAdoption, giving insight into preparedness for the NEV transition. McDonald said that currently Auto makers globally are investing US$1,2 trillion in NEV’s, saying that the TESLA model Y was the world’s best-selling car in Q1 2023 after having been launched in 2020. He stated that Plug-in Hybrids (PHEV’s) are a great opportunity for South Africa.
The second panel discussion comprised Andrew Kirby – Toyota South Africa Motors, Juergen Wolf – Mahle, Riaz Haffejee – IDC, Sjoerd Douwenga – Metair and Stephen Bullock – Anglo Platinum. Addressing the subject of ‘The shift towards NEV’s and the impact on auto component manufacturing’ panelists discussed the topic from a value chain perspective noting that there was a need to have a deep understanding of the market behavior and the Energy value chain. Raw material sourcing is changing for the future and that SA should be focusing on mining, refining, beneficiation and manufacturing within the energy value chain for both the African and global market.
The second keynote address on how logistics and infrastructure can drive the southern african automotive value chain was delivered by Portia Derby, CEO of Transnet. Derby focused on the potential of the Transnet infrastructure, whilst facing the challenges regular and constant theft of its cables etc, particularly on sections of its KZN lines.
The days 3rdpanel included members from SolarAfrica Energy, EY, Hydrogen SA, IDC and IFC. Panelists tackled the subject of Finance and energy considerations for a sustainable production future, whilst ensuring sector compliance with key export markets’ carbon emission regulations.
In the final panel discussion of the opening day, panelists from CSIR, TWIMMS, EOH, Atlantis Foundries and Jendamark addressed the subject of Unleashing Industry 4.0 looking at how technology advancements in automation and digitalization can play a role in a transformed future.
In his opening address on Day 2 of the NAACAM Show 2023, Minister Ebrahim Patel, Dept of Trade, Industry and competition said the local component manufacturing sector plays an important role in the country’s economy with substantial employment levels across Tier 1, 2 and 3 suppliers. Patel continued saying the sector contribution is often understated with focus on the OEM’s – and that if the component manufacturing sector was taken out of the equation, one of the fundamental arguments for the APDP is much weaker. He said the component manufacturers contribution to the local economy were a fundamental argument in the incentives to the industry.
Announcing a combined R4.866bn investment in from 16 of the NAACAM members exhibiting at the show between now and the end of 2024, NAACAM executive director, Renai Moothilal said, the investments were in response to a call to members to report on their planned or committed investment to plant upgrades and new technology to support OEM requirements. Moothilal reported that with these investments the expected retention and creation in employment would amount to in excess of 10 000 jobs, further positively impacting on the local economy.
Minister Patel welcomed the announcement saying these investment pledges are a strong vote of confidence in South Africa and its automotive industry. Patel continued saying, “The component manufacturing capability of a country is an important indication of the industrial depth of a domestic auto sector.” Mikel Mabasa, CEO naamsa/ The Business Council commented that the pledges were welcome in light of the global move by OEM’s into NEV’s. Mabasa saidthe investments will facilitate an improvement in the local content of vehicles manufactured in South Africa - currently in the region of 40% - to achieve the 60% targeted in SAAM35.
Mabasa said, naamsa understands that a number of these component manufacturers are looking at introducing innovation and new technologies in order to be able to respond ahead of the curve to the future needs of OEM’s regarding production of NEVs in the SA.
The SA automotive industry is awaiting clarity from government in terms of NEV policy and any incentives for SA, which is due to be announced by the end of October 2023.
After the official walk through of over 130 exhibition stands attached to the show, delegates returned to the first panel discussion on the role of black industrialists and incubation in the component manufacturing industry, moderated by Mbasa Kepe of BMW South Africa. Dave Coffey from African Association of Automotive Manufacturers (AAAM)
moderated the second panel discussion focusing on strategies for expansion and industrialization of the african automotive industry.
The final session of the day, “Women in Autos” hosted by AITF, discussed the topic of ‘The impact of industry mobilization on women owned businessws and youth” with panelists from merSETA, WECONA,BMW South Africa, NAACAM, Dept of Economic Dev Enviromental Affairs & Tourism, Eastern Cape and Auto Industrial Group.
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