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Lesson in reality for SA's automakers

2015-07-13 07:05


WHEN TIMES ARE TOUGH, THE TOUGH GET GOING: The South African auto industry is really having a tough time. Could we maybe see factories being mothballed to survive? Image: Honda Cars

A motoring colleague in the UK once shared with me an amazing statistic about the four-month mothballing of the Honda car factory in Swindon because of austerity measures a few years ago.

The automaker saved £2 (about R38) in energy costs for every second of the shutdown.

Auto plants around the globe are having a torrid time - especially those here in South Africa. Sales of new vehicles have dipped because not only potential private, but also corporate, buyers can’t afford them.


Labour woes continue to cause havoc, Eskom cannot guarantee power 24/7 as it should - none of that is good news to the man-in-the-street.

And there no exception to that rule: Rolls-Royce, BMW and even Bentley sales are affected. It’s quite simple: money is tight!

The word recession, if I’ve figured it right, may have turned the corner in Europe but it’s been a long and uphill struggle for automakers in the UK where Japanese motor assembly plants are well represented - Nissan up north in Sunderland, Toyota in the Midlands and Honda down south, near Swindon.

British motoring colleague Graham Ruddick, who works for a national daily in London, has been following the fortunes of motoring giant Honda and came up with some more interesting facts I’d like to share with you this week in Wheels24.


At the 200ha Swindon plant, Honda workers are once again producing a significant number of cars for global consumption daily – 300 Jazz units (Europe’s top seller) are being assembled seven days a week. Accords and Civics are coming off other assembly lines.

Honda employed almost 5000 people before the mothballing. Now there are about 3400 with a compulsory built-in wage cut of three percent for artisans and five percent for management.

I wonder if we could learn from that particular business practice in South Africa?

Perhaps more to the point, Honda saved about £2 (R38) every second in energy costs during that four-month period - a staggering amount of money.

Ruddick went on to say that during the forced shutdown workers reportedly spent their time travelling, doing those home DIY jobs they had promised, or went for further training.

Ruddick said: “One lad, after 15 years at the plant, found the time to study aerospace technology at the Open University.”


When the factory re-opened many employees found they had a new role to play and a different bosses to please – but Ruddick believes the Swindon operation will be a much stronger assembly plant at the end of the day.

Unfortunately, I’m not convinced we’ve reached the end of a recession here in South Africa. As stated earlier, the new car market in SA is well down from past years, restrictions on borrowed money remain just as tough as ever. We have several major car plants that rely heavily on exports: Nissan, Toyota, Ford, VW, BMW and Mercedes-Benz among them.

I sincerely hope the powers that be continue to look north for professional guidance and how to survive in these tough times... somehow, I doubt it.

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