Pretoria - Vehicle manufacturer BMW's R2.2 billion investment is a vote of confidence in the South African economy by the private sector, Economic Development Minister Ebrahim Patel says.
"Today's launch of the production of the new 3 Series BMW and the investment of R2.2 billion by the company is a private sector vote of confidence in our economy," Patel said on Monday afternoon.
Speaking at BMW's plant in Rosslyn, the minister welcomed the soon-to-be-launched vehicle to the industry. The automotive industry accounts for about 10% of the country's manufactured exports and 5% of total exports. South Africa produces 550 000 cars annually.
"South Africa has attracted the leading international brand of motor manufacturers not only because of government's incentives to the sector, but also because the South African industry has consistently met the quality standards required by its parent company," explained the minister.
The new 3 Series will create 600 new jobs in Rosslyn.
Government's plan to strengthen port, rail and road infrastructure will reduce transport and logistical costs to manufacturers, making South Africa a more competitive investment destination.
The minister called on industry to support the training of auto electricians and motor mechanics which are in short supply.
The Automotive Production and Development Programme (APDP), which will replace the Motor Industry Development Plan (MIDP), will focus on a production incentive that calculates benefits on the basis of actual local production content and not on material cost as is in the MIDP.
"The new incentive is meant to stimulate growth in the automotive industry to 1.2 million vehicles per annum by 2020, with specific gains in the component industry. The APDP is meant to be a generator of jobs and industrial development."
Patel added that government recognised the importance of the motor industry and motor component manufactures to create jobs, grow the economy, export, introduce and develop new technology.
"We see BMW not merely as a foreign investor in South Africa but our partners in social and industrial development," said Patel.
