OVERVIEW Manufacturing
OVERVIEW Manufacturing The OR Tambo Aerotropolis is attracting manufacturing. The Eastern Corridor of Gauteng, centred on the metropole of Ekurhuleni, is consolidating its leading position in manufacturing by leveraging the advantages of hosting the OR Tambo International Airport and related Special Economic Zones and industrial parks. Ekurhuleni Metropolitan Municipality has the greatest concentration of manufacturing enterprises, especially between Wadeville and Alrode, south-west of Alberton. Germiston is the country’s biggest rail junction and Transnet Engineering has invested hundreds of millions of rands in new equipment at its facility there. The Provincial Government of Gauteng has tabled plans to bolster manufacturing capacity in the province’s western areas. The priorities are mining and mineral beneficiation, capital equipment and machinery, agriculture and agro-processing, tourism, retail and economic development in townships. The industrial parks at Babelegi, GaRankuwa and Ekandustria are to be renovated. Manufacturing contributes 14% to Gauteng’s real economy output and provides 40% of South Africa’s manufacturing overall. Manufacturing related to the mining industry, historically the lynchpin of the Gauteng economy, is still important. Employer organisations like the Manufacturing Circle and government at national and provincial levels are engaging in initiatives to grow the sector, including incentives such as the Manufacturing and Competitiveness Enhancement Programme (MCEP) of the Department of Trade, Industry and Competition (dtic). Sectors that have received support include plastics, pharmaceuticals, chemicals, metal fabrication, transport equipment and agri-processing. The Support Programme for Industrial Innovation (SPII), run by the Industrial Development Corporation (IDC) on behalf of the dtic, promotes technology development. Another IDC initiative has allocated R23-billion over three years to support the Black Industrialist Programme to help existing entrepreneurs grow their businesses. Venter Consulting Engineers, manufacturer of precision engineering equipment, recently attracted the attention of Italian company Danieli and won a contract to create two sophisticated globoid gear sets. Also called the hour-glass gear, this technology allows for an increased number of teeth that are simultaneously in mesh and improves the conditions of force transmission. A handful of firms globally are in a position to make these gears, which can stand massive amounts of stress. SECTOR INSIGHT A precision engineering firm is gearing up for international contracts. Packaging company Nampak, which in 2019 celebrated its 50th year as a listed company on the JSE, has metals, plastic, paper and glass operations at various locations. It is the market leader in beverage cans. The country’s biggest glass producer, Consol Glass, has facilities in Clayville, Wadeville and Nigel. Household products manufacturer Unilever represents an example of the lighter industrial capacity of the East Rand. Kellogg’s, Kimberly- Clark South Africa and Procter & Gamble all have significant manufacturing capacity in the area. Corrugated paper manufacturer Corruseal has purchased the Enstra Mill in Springs from Sappi, giving it greater control of production. The southern portion of Gauteng around Vanderbijlpark and Vereeniging is synonymous with steel production. Flat iron is made at the large plants of ArcelorMittal. Scaw Metals has a chain-making factory in Vereeniging. There are 35 aluminium processing firms in Gauteng, involved in both secondary processing to produce foils, GAUTENG BUSINESS 2020/21 36
OVERVIEW cans, bars, rods and sheets, with final fabrication in the form of die-casting and sheet metal work. Within Gauteng, the automotive and packaging industries are the chief consumers of these products. AECI is a large manufacturing company with its roots in the mining industry. It comprises two principal divisions: AEL Mining Services (with a large factory site at Modderfontein south of Johannesburg) and Chemical Services, which presides over 20 separate companies (including Senmin, the group’s mining chemicals company). More than half of the companies operating in the food and beverage sector in South Africa are in Gauteng, including Nestlé, Tiger Brands, Pioneer Foods, RCL, AVI and Astral. There are approximately 4 000 food-processing companies in the province, employing more than 100 000 people. Although there are more than 200 pharmaceutical firms in the country, large companies dominate the field, with Aspen Pharmacare (34%) and Adcock Ingram (25%) the two key players, followed by Sanofi, Pharmaplan and Cipla Medpro. Among the other big international brands active in Gauteng are Merck, which has a 55 000m² plant at Modderfontein, and Pfizer SA, which runs a laboratory in Sandton amongst its facilities in South Africa. All of Gauteng’s large automobile manufacturers are investing in new model production. Nissan is spending R3-billion on production of the Navara pick-up vehicle. Other major investments include R3-billion by Ford at Silverton, R6.1-billion by BMW at Rosslyn, R260-million by BMW on an expanded campus at Midrand. UD Trucks, a part of the Volvo group, will assemble the Croner heavy commercial vehicle at Rosslyn. Gauteng is also home to a strong automotive components industry, together with several bus and truck assembly plants. ONLINE RESOURCES Centre for Advanced Manufacturing: www.cfam.co.za Chemical and Allied Industries’ Association: www.caia.co.za Gauteng Department of Economic Development: www.ecodev.gpg.gov.za Manufacturing Circle: www.manufacturingcircle.co.za CREDIT: Venter Consulting Engineers These include Scania, TFM Industries and MAN Truck and Bus South Africa, as well as the Chinese truck manufacturer FAW, which owns an assembly plant in Isando. Beijing Automotive Works (BAW) assembles taxis at Springs. Armoured cars are also produced. The Paramount Group has signed a contract to supply the United Arab Emirates with its latest armoured personnel carrier, the Mbombe 4. Paramount South Africa has been created to work in the local market. DCD Protected Mobility manufactures armoured cars in Boksburg, which are branded as Vehicle Mounted Mine Detectors. In nearby Benoni, BAE Systems OMC designs and manufactures protected vehicles. ■ 37 GAUTENG BUSINESS 2020/21
