Ford Motor Company this morning announced an investment of $1.05 billion (R15.8 billion) in its South African manufacturing operations. This marks the biggest investment in Ford’s 97-year history in South Africa, the company said. The South African government welcomed the announcement, which is one of the largest-ever investments in the South African automotive industry. It will not only boost Ford’s production capability, but also create 1,200 incremental new jobs in SA.
This will increase the local Ford workforce to 5,500 employees, and add an estimated 10,000 new jobs across Ford’s local supplier network, bringing the total to 60,000.
Ford announced the investment at a media briefing attended by South African President Cyril Ramaphosa (who gave the keynote address), as well as several key government leaders, including Trade, Industry and Competition Minister Ebrahim Patel, Department of Public Enterprise Minister Pravin Gordhan, Gauteng Premier David Makhura, City of Tshwane Executive Mayor Randall Williams, and senior Ford executives.
With this investment, Ford’s Silverton Assembly Plant is expected to generate revenues exceeding 1.1 percent of South Africa’s gross domestic product.
The Silverton plant will increase its annual production to 200,000 vehicles from 168,000, mainly of the all-new Ford Ranger pickup truck (or bakkies!) for the domestic market and export to over 100 global markets. The plant also will manufacture Volkswagen pickup trucks as part of the Ford-VW strategic alliance.
“This investment will further modernize our South African operations, helping them to play an even more important role in the turnaround and growth of our global automotive operations, as well as our strategic alliance with Volkswagen,” said Dianne Craig, president, Ford’s International Markets Group. “Ranger is one of our highest volume, most successful global vehicles. This investment will equip our team with the tools and facilities to deliver the best Ford Ranger ever, in higher numbers and with superior quality.”
The SA Government said once the investment at the Silverton plant is completed, it will pump R1.3 billion in wages and salaries annually into the Tshwane economy.
Minister Patel said some key government policies championed by the President, informed the decision of Ford, and enabled rapid decision-making. One of these is the Special Economic Zones framework which lead to Tshwane being designated as an Automobile SEZ in October 2019.
“Tshwane is on the road to becoming an Auto City, producing cars for local use and export to more than 150 countries,” said the Minister.
“President Ramaphosa set a target of R1.2 trillion of fresh investment needed to be raised over a five-year period, in order to grow the economy. Today’s announcement of R16 billion by one firm alone is 1.3% of the total…
“This is a boost for our efforts to recover growth and jobs in the economy following the impact of Covid-19 on livelihoods and to prepare South Africa for the opportunities of the AfCFTA,” Minister Patel said.