The Volkswagen plant in the town of Kariega in South Africa’s auto heartland, the Nelson Mandela Bay Metropolitan Municipality.
Photographer: Leon Sadiki/BloombergAfrica’s Motor City Is Buckling Under a Tide of Asian Imports
Grappling with competition from Chinese and Indian rivals, South Africa’s automakers are calling for drastic policy changes.
Luthando Kolisi jokes that if he finds work at another factory, it will probably end up shutting down. That’s how he lost his last two jobs. Since being let go from the Goodyear Tire & Rubber Co. factory in Nelson Mandela Bay — a coastal South African city that is the heart of the country’s automotive industry — he’s sent out countless applications, while eking out a bit of cash from odd jobs. “I’m slowly beginning to lose that hope,” he said.
The auto sector makes up the biggest share of South Africa’s manufacturing and its contribution to the country’s economic output rivals that of the mining sector, but it is buckling under the pressure of rising costs and a flood of cheaper imports from India and China. Companies, including giant manufacturers Toyota Motor Corp. and Volkswagen AG, are clamoring for urgent policy interventions to help them compete. In a rare alignment, unions and investors have joined forces to do the same.