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GMSA to focus on Isuzu, Chev

2010-01-28 10:43

Riana de Lange

Port Elizabeth - Most of the R900m that General Motors South Africa (GMSA) will spend on expansion over the next three years is related to future products like the new generation Isuzu KB and Corsa Utility, the current generations of which are both assembled in Port Elizabeth.

Edgar Lourençon, president and managing director of General Motors Africa, says this forms part of an approved investment plan in the region and is linked to recent years' expenditure of R4bn on facilities and systems to serve GM dealers better.

Meanwhile, construction of GMSA's new R250m parts distribution centre at Coega is well under way. The centre should be operational by the fourth quarter.

Lourençon, a born and bred Brazilian, began his career at GM in 1977 as an engineer. Before starting in South Africa in November he was, inter alia, GM managing director in Chile, Bolivia and Peru, concurrently with the same role for GM in Argentina, Paraguay and Uruguay.

After three months in his new position he notes a positive sentiment among workers following the economic turmoil of the past two years, when GMSA cut its workforce by about half.

The mood among dealers is also very positive. Despite the recession, very few GMSA dealers have closed their doors, he comments.

The Chevrolet brand has performed well in South Africa over the past year and has increased its South African market share from 4.5% to 5.8%.

With regard to new vehicle sales, GMSA does not expect an "explosion" in the market in 2010, but rather a 5%-odd improvement up to 412 000 units compared with last year's 394 000.

The vehicle industry is concerned about Eskom's proposed price hikes because South Africa's electricity tariffs have so far favoured the manufacturing industry. If the increase is approved, the industry will lose one of the few elements helping South Africa in an exceptionally competitive industry.

Lourençon says Africa is a developing region with great growth potential. GMSA is already exporting vehicles to Zambia, Zimbabwe, Malawi, Mauritius, Mozambique and Botswana - especially the Isuzu KB. Competitiveness remains the key to success.

He cautions that Africa still has a way to go before emulating Brazil, especially in light of its infrastructural challenges, political instability in certain African countries and trade agreements that are not always practicable.


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