Confidence under pressure

Consumer confidence is under severe pressure from rapidly escalating prices, political uncertainty and an economy that has not kicked into the higher gear anticipated when Cyril Ramaphosa became President.

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Mark Domisse (left) and Ghana Msibi

This was the underlying sentiment that emerged from the comments at the recent (23rd) annual National Automobile Dealer’s Association (NADA) awards function for Dealer Satisfaction Index (DSI) results.

“The DSI survey forms a vital link in the relationship between dealers and manufacturers. This year’s survey showed a high completion percentage rate of more than 80% in the passenger vehicle section,” says Mark Dommisse, National Chairperson of NADA. “We also had one of the highest completion ratios in DSI history this year, which is extremely encouraging.

“The DSI survey provides the dealer body with a platform to provide robust feedback to manufacturers and importers. In most cases, the findings are used to benefit the working relationship for both parties.”

Over the years, the results of the survey have been used by dealer councils and manufacturers as an effective management tool to address areas of concern and thereby improve service delivery throughout the entire value chain to the ultimate benefit of the consumer.

“Political uncertainty has had a major effect on investment appetites, as well as consumer spending on large ticket items,” he says.

“While consumer confidence is relatively high, the rest of the underlying metrics such as household debt, inflation, fuel, and increased consumer taxes are putting our businesses under pressure. Apart from a very slow economy that has not quite manifested in the Ramaphoria everyone had hoped for, the retail motor industry is facing frightening pressures.

“We need to embrace the ever-growing presence of digital disruptors in our game. They are competitors to the traditional dealer model, used car supply and our F&I departments and we are being challenged. We need to evolve and continue to align with this new generation of customer.”

Paul de Vantier, Managing Director, Lightstone Consumer, noted when it comes to online marketing and dealing, this industry has seen a growing number of people who will transact the whole deal online, from start to finish, with the dealer simply being a delivery and service point.

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“This is not something that’s coming, he says, “it is something that is already happening – and this trend will grow.”

De Vantier also made note of South Africa’s ageing car parc. In 2015 it was 9,6 years, but now it has aged to 9,9 years. He attributes this to rising vehicle prices, affordability and general consumer confidence.

“Consumers either cannot afford to replace their vehicles or lack the confidence to commit to long term financing deals,” he says.

Ghana Msibi, the Executive Head of Sales and Marketing at WesBank, says: “We cannot ignore the largest disruptor out there – the new generation of customers. As an industry, we cannot continue to offer them solutions on the same basis as we have done before.

“Our traditional approach has given us a superior footing in the industry, but if we do not meet them halfway, they will ultimately find alternatives that suit them.”

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Manufacturing awards boost industry

The changing face of the manufacturing industry in South Africa will be given a boost in November with the debut of the first awards officially recognising innovation and excellence in Advanced Manufacturing.

The National Advanced Manufacturing Innovation Awards, is hosted under the auspices of the DTI co-funded, national Composites Cluster with a wide scope including the key drivers of the 4th industrial revolution.

All companies operating in the advanced manufacturing field, including 3D printing, robotics, automation, AI, laser cutting and etching, CNC machining, software, big data, IOT and composites will be eligible for national recognition.

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Companies or organisations may make submissions in six categories including: Scholarly impact in advanced manufacturing, Industry advancement in advanced manufacturing, Export proficiency, Contribution to Import replacement, Composites Innovation and Most promising ‘start- up or newcomer’.

Composites Cluster MD, Andy Radford, formerly an industrialist at the CSIR, before the Composites Cluster was established with the support of the South African government, said the awards would play a key role in advancing the country’s advanced manufacturing agenda.

“As we push to consolidate and develop our manufacturing strategy, it is essential as a collective – government and private sector stakeholders identify, promote and reward innovation in the advanced manufacturing and composites industry.”

Radford said the awards, which would be made annually at the African Advanced Manufacturing and Composites Show (with the inaugural event set to take place from November 7-9) would also “aim to showcase South Africa’s capabilities and popularise Advanced Manufacturing in industry and to learners.”

He said entries close on July 27.

The National Advanced Manufacturing Innovation Awards will take place as part of the African Advanced Manufacturing and Composites Show, which will include a dynamic, interactive exhibition, conferences and factory tours.

Organisers say several international delegations have already confirmed, including leading Advanced manufacturing companies from France and Germany, while a focused campaign will draw dominant advanced manufacturers from Africa.

“While manufacturing remains an essential part of South Africa’s economy – contributing around 19% of GDP, our efforts towards Advanced Manufacturing in South Africa are highly fragmented, but we do have significant pockets of excellence,” Radford says.

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“The African Advanced Manufacturing and Composites Show will not only bring all the key role-players and technology partners together towards a common vision, it would also inspire emerging engineers.

“Three-dimensional printing, lasers, automation and artificial intelligence are exciting tools to encourage a new generation of engineers and scientists but we need to expose them and industry to these technologies and there is no time to waste.”

Radford added the KPMG 2016 Global Manufacturing Survey, showed the extent to which global manufacturers were racing for advanced manufacturing leadership.

“Some 25% of 360 respondents said hey had already invested in three-dimensional printing and additive manufacturing technologies. An equal number had also already invested in artificial intelligence and cognitive computing technologies.

“Two-fifths of survey respondents said they would definitely channel significant amounts of their research and development investments towards robotics before 2019.

“The message is clear that certain manufacturers and manufacturing countries will ensure their sustainability and growth in Industry 4.0 where others will be left increasingly far behind in servicing an increasingly demanding global client base.

“The Nelson Mandela Bay Stadium venue, alongside the North End Lake, is ideal for the outdoors demonstration of boats, vehicles, and drones all of which encapsulate Advanced Manufacturing technologies and indoor exhibits showcasing automation, computing and 3d printing, among others.

The show will be accessible to both trade and public visitors.

Radford said the organisers of the Show have a vision and strategy to ensure that the African Advanced Manufacturing and Composites Show attracted global role-players in all areas of Advanced Manufacturing, including Composites and especially African role-players.

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To this end Radford said delegations from France and Germany have already confirmed while an MOU had been signed with UK Composites and a marketing campaign would target African buyers.

 

Beetle mania hits town

Beetle mania is coming to the National Arts Festival in Grahamstown (soon to be renamed Makhanda) in the form of six Volkswagen Beetles, each with its own special history.

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Nestled on the university lawns between Lucas Avenue and the Albany Museum, is the ‘Meet the Beetles‘ installation where six, carefully selected Volkswagen Beetles are on display at the National Arts Festival in Grahamstown.

“The purpose of the installation is to provide festival goers with a taste of the treasures of Volkswagen’s museum, the AutoPavilion in Uitenhage. The Beetles each have a story which appeals to fans of the iconic ‘love bug’ also crowned the ‘Car of the 20th Century’,“ says Matt Gennrich, Volkswagen Group South Africa (VWSA) General Manager for Communications.

‘Meet the Beetles‘ showcases Jan, the oldest Beetle in South Africa, film star Herbie, Delilah with her super low mileage, Jeroen the Mexican-built, Trans-Saharan Traveller from Amsterdam, Matti – the last Uitenhage-built Beetle and Nomhle the most beautiful Beetle with her bling!

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The National Arts Festival, which opened on Thursday, 28 June features a wide variety of performances and installations, including ‘Meet the Beetles‘ and its art installation.

Four of the six Beetles were positioned counter to the lay of the land with Delilah positioned on a popular thoroughfare ensuring the public can walk around the ivory beauty with her fuchsia pink number plates.

Jeroen the Beetle who travelled the length of the African continent has sidled up to an Acacia – the most African of trees. Central to the installation is Jan, the oldest Beetle in South Africa, placed carefully on ramps by the VWSA Product Engineering Team who assisted in positioning the valuable collection.

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Rounding off the setup is a collaborative artwork for kids of all ages – a classic hippie Beetle to be computed in using wax pastels. And to end every day is an illumination of the exhibits and T1 tents which glow into the evening enticing festival goers to a second visit.

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‘Meet the Beetles‘ runs for the duration of the National Arts Festival in Grahamstown. It is open 24 hours a day, but staff is on site to assist guests between 9am and 5pm. It is located on the university lawns between Lucas Avenue and the Albany Museum.

There is also unique branded merchandise on sale at the stand which includes winter favourites like beanies, scarves, gloves, hoodies, and much more.

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VW Golf in SA turns 40

In the annals of enduring love affairs, the one between South African motorists and the Volkswagen Golf is ongoing with as much passion involved as the day the first of the front-wheel drive hatchbacks was launched back in 1978.

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Now, 40 years down the line and up to Mk 7, the little charger still promotes plenty of petrolhead frenzy and lively debate.

Design work on the Golf began in 1971, with production starting in Germany in March 1974 and deliveries to customers commencing in June 1974.

After 31 months in production the Mk1 had already sold 1-million units and its success would continue in South Africa where the hatch back was launched in May 1978. Production in Uitenhage started with 65 units a day with a local content of 57%.

Its space-saving front-wheel drive and 1.5-litre four-cylinder transverse front-mounted, water-cooled engine, with just 70 horsepower delivered impressive performance. The initial launch price of the 1100 cc L two-door was R3 985 while the rest of the line-up included the LS four-door priced at R4 135, whilst the 1500 cc GLS four-door manual and automatic retailed for R4 940.

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During the years after 1978 a number of variants were introduced into the model line-up including a diesel version at the end of 1978 and the high performance 1600 cc Golf GTS with its matt black bumper, extra-wide radials, bib spoiler, four headlamps, GTS logo and stripes along the bottom of the doors and quarter panels.

In less than 12 months (April 1979), the 20 000th Golf was already produced in Uitenhage and by February 1980, the 50 000th Golf, a GTS model, left the production line. By 1981, the 100 000th Golf had been produced – just over three years since its introduction.

Four years since launch of the Golf Mk1, in 1982 the Golf 1 GTI was launched in South Africa, creating a whole new concept in performance motoring, the ‘Hot Hatch’.

In 1983, almost 10 years after being launched in Europe, the Golf Mk1 was replaced by a larger and more sophisticated second-generation model.

This paved the way for Volkswagen South Africa to retain the Golf Mk1 so as to maintain a presence in a segment which was about to be vacated by its successor and so the concept of the Citi Golf was born.

No other vehicle in the history of motoring in South Africa has broken as many records and sold in such high numbers as the Golf Mk1. The Citi Golf was produced for 25 years in South Africa and more than 370 000 units were sold before production ceased in 2009.

In 1992, the fuel injected Golf 3 was launched in South Africa with an all-new 1,4-litre petrol engine. Also offered was a naturally aspirated version of the 1.9-litre diesel engine, delivering 47 kW. Air bags were first offered on the Golf in 1992, and from 1996 anti-lock brakes were standard across the range.

In 1999, the Golf 4 replaced the Golf 3, setting new class standards. The fourth generation was a deliberate attempt to take the Volkswagen Golf further upmarket, with a high-quality interior and higher equipment levels.

The last generation of the Golf to be built in South Africa was the fifth generation which was launched in August 2004 and raked up 1 300 sales in its debut month. In the following year, a Candy White 2,0-litre Golf became the 750 000th Golf to be produced in Uitenhage.

After 30 years and more than 813 000 Golfs made in Uitenhage, production of Golf was stopped in South Africa in December 2008. This was due to the rationalisation of models to maximise volume production and meet objectives of the Motor Industry Development Programme (MIDP).

The sixth generation imported Golf was launched in South Africa in April 2009. The model sold in South Africa currently, the Golf 7, was launched in February 2013 and is a segment leader in 2018 with a share of 35%.

 

 

 

 

We are one

Fiat Chrysler Automobiles (FCA) in South Africa has merged its individual national sales companies to complete the integration locally of the world’s seventh largest car maker.

While FCA South Africa has been under a single management team since 2012 in line with the global merger, Fiat Group Automobiles South Africa and Chrysler South Africa have been operating as separate financial entities. The administrative merger of the entities from will formalise Fiat Chrysler Automobiles South Africa (Pty) Ltd as a single trading entity.

“We are excited to enter the next phase of FCA in South Africa,” says Robin van Rensburg, CEO of FCA South Africa. “For our customers, it will be business as usual with even more improvement in service levels thanks to the simpler and more effective systems.

“Our dealers and partners have invested with us over the past six years to get to this point and this will allow them to become even more effective.”

FCA South Africa is responsible for the sales and after-sales business of the Abarth, Alfa Romeo, Fiat, Fiat Professional, MOPAR, Chrysler, Jeep and Dodge brands. MOPAR won the Gold Achiever Award for Excellence in Logistics in 2017 and FCA’s first-time pick rate remains the industry benchmark in South Africa, benefiting customer experience directly with aftersales service efficiency.

The product future for FCA South Africa is bright and 2018 will see the introduction of the all-new Jeep Compass and the Alfa Romeo Stelvio QV in the third quarter.

The latter will be another in the performance SUV segment, as will the Jeep Grand Cherokee Trackhawk, the most powerful and quickest Jeep SUV ever powered by the supercharged 6,2-litre V8 engine delivering 522 kW and 868 Nm of torque. The venerable Jeep Wrangler replacement will make its debut appearance in late 2018.

“We have created a vision to take us forward into 2020 in a sustainable and profitable manner, having learnt some valuable lessons from the past,” says Van Rensburg. “Customers will only benefit from this merger and the dealer network will remain unchanged. FCA’s brands will continue to succeed in the market and we look forward to the journey with our customers, dealers and partners.”

 

Ford expands engine plant

Capacity at the Ford Motor Company of South Africa (FMCSA) engine plant at Struandale, Port Elizabeth is being boosted to provide a new assembly line for the diesel engine that will power the Ford Ranger Raptor when it is launched next year.

This forms part of a wide-ranging investment in its two South African plants, announced late last year.

“We are delighted to confirm that, as part of the R3-billion investment announced in November 2017, we are expanding both the capability and capacity of the Struandale Engine Plant for our current and future engine programmes,” says Jacques Brent, President of Ford Middle East and Africa.

“The investment includes the installation of a sophisticated new assembly line for an all-new diesel engine program and, at the same time, we are boosting capacity for the current Duratorq TDCi engine that is used in the Ford Ranger and Everest, with new derivatives and additional European markets being introduced for the local operations.”

The new diesel engine assembly hall is located in a totally revamped 3 868 m2 section of the Struandale Engine Plant, and boasts Ford’s latest, state-of-the-art manufacturing processes.

Eight derivatives of the new engine will be assembled at the Struandale Engine Plant when production officially commences in the fourth quarter of 2018. The new assembly line has an installed capacity of 120 000 engines a year.

 The current component machining and assembly lines for the Duratorq TDCi diesel engine, which has been produced locally since 2011 for the Ford Ranger and Everest, are also being expanded.

“Our upgrades for the Duratorq TDCi program adds incremental volumes, with 22 new four-cylinder engine derivatives to be exported to European markets, including for use in front-wheel drive Ford models,” Brent states. “This introduces three significant new customers for the Struandale Engine Plant, comprising Italy, Turkey and Russia.”

Ultimately, the Struandale Engine Plant will become the home of all Duratorq TDCi engine component machining for the Ranger, Everest and Transit, along with expanded engine assembly in conjunction with current operations at Ford plants in Thailand and Argentina.

“This places our South African business in a central role within the global Ford network, and reaffirms our commitment to developing the automotive industry within the local market, and in the broader Middle East and Africa region,” Brent adds.

With the additional 2.2-litre engine derivatives officially coming on line in the fourth quarter of 2018, the Struandale Engine Plant will be assembling a total of 56 variants of the Duratorq TDCi engine.

Installed capacity for the Duratorq TDCi program is set to increase from the current 254 000 machined component sets (cylinder head, block and crankshaft) to 280 000, while assembly capacity will grow from 115 000 to 130 000 engines per annum.

To accommodate the significant production expansion for the two engine programs, a brand new warehouse was built at the Struandale Engine Plant. The new 5 418 m2 facility was designed to house all the required parts, components and tools on-site to maximise production efficiency for the two engine programs.

 

Big money up for grabs

The 2018 surfing calendar in South Africa has been firmed up with the confirmation Volkswagen South Africa is continuing the headline sponsorship of the City Surf Series with more than R1-Million in prize money up for grabs in the race to Nelson Mandela Bay.

“For us, getting involved with the City Surf Series was a no-brainer as the Volkswagen brand has been associated with surfing for many years with surfers using their camper vans and Kombi’s to go on surfing tournaments,” says Matt Gennrich, General Manager for Group Communications.

The second edition of the City Surf Series (CSS) will see six events, culminating in the Volkswagen SA Open of Surfing presented by Hurley, taking place in different cities along South Africa’s coastline from March to June.

Each of the CSS events will feature Qualifying Series (QS) rated men’s, women’s junior men’s and junior women’s competitions, Surfing South Africa (SSA) longboard men and women and Stand-up Paddling (SUP) men and women’s categories.

A major change from last year’s series is the upgrading of the Volkswagen SA Open of Surfing women’s event to a QS3000, making it the biggest women’s QS in Africa. The Nelson Mandela Bay Pro men’s event has also been upgraded to a QS1500.

“Another exciting addition is the launch of a new event, the Port Alfred Classic, which will feature men’s and women’s QS Longboard events with the two disciplines also added to the Volkswagen SA of Surfing presented by Hurley,” says Johnny Bakker, Surfing South Africa president.

“As Nelson Mandela Bay is the home of Volkswagen, we are also proud that the Volkswagen SA Open of Surfing has relocated from Durban to Nelson Mandela Bay,” added Gennrich.

The Volkswagen SA Open of Surfing events being hosted in Nelson Mandela Bay are expected to bring in an estimated 4 000 to 6 000 visitors and an R18-million cash injection for the city.

Not only will the CSS events support the local economy, all events will give back to the community and environment by incorporating Learn to Surf Initiatives as well as Community Clean-the-Beach programmes.

In the 2017 edition of the CSS, more than 300 previously disadvantaged children across the five events were taught to surf.

2018 City Surf Series Event Schedule:

  • Volkswagen Nelson Mandela Bay Surf pres. by Billabong: 30 March to 2 April
  • Royal St Andrews Port Alfred Classic pres. by Quiksilver (Inaugural event): 6 to 8 April
  • Mitchum Buffalo City Surf Pro pres. by Reef Wetsuits: 13 to 15 April
  • ZigZag Durban Surf Pro pres. by G-Force: 18 to 20 May
  • Jordy Smith Cape Town Surf Pro pres. by O’Neil: 14 to17 June
  • Volkswagen SA Open of Surfing pres. by Hurley: 19 to 24 June