OVERVIEW Manufacturing
OVERVIEW Manufacturing general Aspen is making vaccines for Africa. SECTOR INSIGHT Montego Pet Nutrition is Graaff-Reinet’s biggest employer. The Aspen Pharmacare facility in Gqeberha will make hundreds of millions of doses of the Johnson & Johnson Covid-19 vaccine for South Africa and Africa. A consortium of development finance organisations, including the World Bank’s International Finance Corporation, made €600-million in financing available to the South African company in the course of 2021 to assist it in ramping up production of the vaccines. By 2022, the facility should be making about 500-million doses annually. Aspen’s earlier investment of R3.3-billion to scale up production for vaccines for Africa created 1 775 jobs, of which 52% went to women. The provincial government aims for more diversification in manufacturing and is targeting sectors where the province already has a competitive advantage (such as wool and mohair), are labour intensive, will have a broad impact and have low barriers for SMME entry. A fibre-processing plant to spin wool and mohair fibre into yarn is planned, as is a textile mill to focus on cotton, poly-cotton and acrylic fabric. The latter is planned for the IDZ in East London, which is already home to Da Gama Textiles, whose factory has the capacity to produce 45-million square metres of fabric per annum. Da Gama makes the popular and distinctive shweshwe fabric, using its own unique printing process. Several cluster development programmes aim to develop specific industries by bringing together expertise and logistical support. A Non- Automotive Manufacturing (NAM) Cluster concentrates on training, supplier development, energy efficiencies and developing new markets. Swedish concern Fagerhult Group has entered the South African market via an acquisition of the factory of Port Elizabeth’s Lighting Innovations, and the ONLINE RESOURCES Coega Development Corporation: www.coega.co.za East London Industrial Development Zone: www.elidz.co.za Eastern Cape Development Corporation: www.ecdc.co.za two subsidiary companies Arrow Lighting and Beacon Lighting. Montego Pet Nutrition, Graaff-Reinet’s biggest private employer, has recently installed an impressive array of solar panels on the roof of its facility (pictured). More than 200 staff members work in the Karoo town’s factory. First National Battery, a Metair Group company, has one factory at Fort Jackson and two factories in East London. Mpact runs two corrugated packaging convertor facilities in the Eastern Cape, at Deal Party in Port Elizabeth and Gately Township, East London. Bodene, a subsidiary of Fresenius Kabi, makes intravenous medicine in Port Elizabeth. East London hosts Johnson & Johnson’s finance, operations and research and development divisions. The Eastern Cape’s two Special Economic Zones play an important role in attracting investors to the province. Located in East London near of the port and at the deepwater port of Ngqura 20km north of Port Elizabeth, the East London Industrial Development Zone (ELIDZ) and the Coega SEZ provide the infrastructure that will allow the region to expand and diversify its economy. ■ EASTERN CAPE BUSINESS 2022/23 34
Manufacturing automotive Volkswagen has celebrated 70 years of making cars in South Africa. OVERVIEW SECTOR INSIGHT A rail corridor to Gauteng would boost the automotive sector. Volkswagen celebrated 70 years of making cars in South Africa in 2021. In August of that year, the Kariega plant of Volkswagen started exporting the newest version of the Polo vehicle. In 2019, a new production record was achieved when 161 954 vehicles were made, contributing materially to the overall total of four-million that was achieved for the brand towards the end of 2020. The 520 963m² Kariega facility is one of four plants worldwide that makes right-hand drive Polos but the only one in the world that makes the Polo GTI. Ford Motor Company makes engines (pictured) for the Ford Ranger pickup and Everest SUV at its Struandale plant and it has committed to invest R600-million for modernising and growing its local operations. This is a part of a bigger investment which includes the vehicle assembly operations in Gauteng. Ford has initiated discussions about the feasibility of developing a sophisticated rail corridor between Gauteng and the Eastern Cape. The company wants to send parts to Pretoria and export cars through the Port of Gqeberha. The Coega Special Economic Zone (SEZ) is host to the first phase of a major investment by Chinese automotive manufacturer Beijing International Automotive Corporation (BAIC). The total investment by BAIC will total R11-billion and significantly add to the province’s already strong reputation for excellence in the automotive sector. Both ONLINE RESOURCES Automotive Industry Development Centre: www.aidc.co.za Coega Development Corporation: www.coega.co.za Eastern Cape Development Corporation: www.ecdc.co.za Coega SEZ and the East London Industrial Development Zone (ELIDZ) have areas dedicated to automotive and automotive components manufacture. Mercedes-Benz South Africa’s new C-Class project (W206) has sparked several other related investments, which collectively will create 2 078 new jobs over two years. Most of this is happening in the ELIDZ, which has made a commitment to localising the 2nd- and 3rd-tier automotive components that are not currently in South Africa. The production of the C-Class vehicle is a technological marvel and the plant regularly wins international awards for quality. The installation of a new sequencing centre, to be installed by Automotive Logistics Solutions (an AHI company), will make the assembly line even more efficient. Home-grown manufacturer of powertrain and catalytic converter assembly systems, Jendamark, exports to 18 countries. Continental Tyre South Africa is producing a 19-inch tyre for the first time at its New Brighton facility in Port Elizabeth. Isuzu SA has completed its consolidation project, with truck and bakkie manufacturing now taking place at its new headquarters in Struandale, Port Elizabeth. ■ 35 EASTERN CAPE BUSINESS 2022/23
