South African Business 2021

OVERVIEW Engineering

OVERVIEW Engineering Many engineering groups are selling off assets. SECTOR INSIGHT A presidential infrastructure office may breathe new life into the sector. A semi-portable crane from RGM Cranes. Credit: Betterect. Aveng’s disposal of non-core assets is typical of the activity of larger companies in the sector. The company’s website lists Aveng Trident Steel and Aveng ACS (Automotive Control Solution) as solid businesses which will realise good value once a new owner is found and lists another eight businesses (in roads, rail, civils and electrical) which the group sold in 2019. With a renewed focus on infrastructure, resources and mining solutions, Aveng’s main operating companies are now Moolmans in South Africa (contract mining and mining services) and McConnell Dowell (engineering, construction and maintenance) in Australasia, Southeast Asia and the Middle East. Some of the big names such as Group Five, Basil Read and Esor are in business rescue. Others such as Murray & Roberts and WBHO rely heavily on offshore contracts for revenue. Murray & Roberts has completed its transition from being a South African company focussing on contracting to a multinational engineering and construction group with a focus on natural resources markets. An Investment and Infrastructure Office has been created in the Presidency. It is headed by the former Gauteng MEC for Economic Development, Dr Kgosientso Ramokgopa. In 2020, 51 infrastructure projects with a total investment value of more than R340-billion were gazetted and hopes are high that this initiative will provide a boost for engineering firms. A study carried out by KMPG found that spending on infrastructure resulted in additional economic activity worth R26-billion and created 92 000 direct jobs. Marine repair and engineering form a significant sector in the Western Cape and KwaZulu-Natal, with established companies such as EBH South Africa offering comprehensive services. Both KwaZulu-Natal ports are expanding (Durban has built a cruise-liner terminal and Richards Bay is undertaking no fewer than 45 projects) and will continue to attract engineers. Dormac, which is headquartered in the Bayhead area of the Port of Durban, is best known for its marine engineering but it offers specialised services to the sugar industry and provides machinery for industrial giants like Toyota and Defy. SOUTH AFRICAN BUSINESS 2021 70

OVERVIEW Sector news Expansion at Betterect’s manufacturing plant in Krugersdorp has helped to push production to a monthly level of 650 tons of steel plate work. This has necessitated the installation of strong and reliable cranes which have been provided by RGM Cranes for more than 30 years. Betterect specialises in mild and stainless steel fabrication, steel erection and corrosion protection. Betterect recently commissioned RGM Cranes to supply a 30-ton semi-portable crane and two 10-ton single-girder cranes. The smaller cranes lift items for the erection of semi-assembled or fully assembled tanks and skids in the workshop area. Most of the RGM cranes are on site at the Chamdor site but when a fuel gantry was constructed at the airport on the island of St Helena, the two companies worked together there. RGM is the South African agent and supplier for Turkish company Güralp. The Güralp hoist is sent to South Africa in kit form (the hoist, cabling and electrics) and RGM manufactures the girders and assembles the crane. A good sign for the engineering sector came in the news that the Boksburg site where DCD Rolling Stock used to make rail wagons and fix locomotives is up and running again, courtesy of TMH Africa, a part of the TMH Group, which has head offices in Switzerland. ELB Group’s Engineering Services division employs more than 1 000 people and the company is currently working full-time on the vast Gamsberg zinc project in the Northern Cape. Manganese, iron ore and coal are other mining sectors where ELB is active and it does work for Eskom (the national utility) and companies such Nestlé and Unilever. The Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) has created an entirely new industry in less than seven years, with investment of about R200-billion in solar parks and wind farms. This has created many opportunities for engineers. ONLINE RESOURCES Consulting Engineers South Africa: www.cesa.co.za Engineering Council of South Africa: www.ecsa.co.za National Department of Public Works: www.publicworks.gov.za South African Consulting Engineering Firms: www.consultsa.co.za Southern African Institution of Civil Engineering: www.civils.org.za Training A study jointly commissioned by the Water Research Commission and the South African Local Government Association (SALGA) found that the country’s four-in-amillion ratio of engineers is a long way from the required 50-per-million. In 2015 there were are 16 423 registered professional engineers in South Africa. One response at national level was the importation of Cuban engineers. Several partnerships between the public and private sectors are trying to address the skills deficit. One example is the partnership that Wits’ National Aerospace Centre has with Boeing and Airbus. The Skills Development Amendment Act is intended to improve the situation. Universities, universities of technology and companies are increasing their focus on the training of engineers. The Engineering Council of South Africa (ECSA) has a programme where trainees can earn certificates in specific disciplines from a range of institutions. The qualifications are in line with the council’s Exit Level outcomes. Six of South Africa’s biggest construction companies have established a R1.25-billion skills fund. ■ 71 SOUTH AFRICAN BUSINESS 2021