Construction of Stellantis forges ahead

Thursday, May 23, 2024

The final building blocks have been laid for the establishment of South Africa’s latest automotive manufacturing site, paving the way for construction to begin at the Coega Special Economic Zone (SEZ) in Gqeberha, Nelson Mandela Bay, in the Eastern Cape.

Stellantis, the world’s third biggest automotive manufacturer by volume, and South Africa’s largest development funder, the Industrial Development Corporation (IDC) have concluded key milestones that will lead to a joint venture. 

The investment estimated at R3 billion is expected to facilitate the creation of massive employment opportunities in the Eastern Cape. 

The Coega Development Corporation (CDC), which is supplying the ground on which the factory will be built, has begun preparing the site for the start of construction.

“I welcome the progress made with concluding all modalities with Stellantis that will enable construction to commence this year and start of production of a new auto model to roll off the assembly line by the end of 2025,” said Ebrahim Patel, Minister of Trade, Industry and Competition.

“The SA auto industry is Africa’s largest producer of cars, bakkies and trucks and this new investment by Stellantis will consolidate the country’s position, helping us to achieve the goal of producing 1.4 million vehicles by 2035.

“The biggest attractions for new investors are the size of the domestic market, together with the auto industry masterplan, which supports local production for both South Africa and export markets,” said the Minister.

He added that Stellantis has a strong growth vision with an excellent range of vehicles in its global stable. 

“We look forward through this investment to increasing the range of locally manufactured cars available to motorists,” Patel said.

The Minister said it was heartening to see the manner in which the combination of expertise within the collective of the Department of Trade, Industry and Competition (DTIC), the IDC, CDC and Stellantis united to form a cross functional team that is making excellent progress.

“It’s this teamwork that will realise not only having Stellantis as SA’s eighth OEM, but most importantly in realising the plans for employment and investment in South Africa and support our industrialisation drive. 

“We look forward to a long and mutually beneficial relationship between Stellantis and South Africa,” Minister Patel said.

Stellantis Middle East Africa (MEA) COO, Samir Cherfan, Stellantis SA MD Mike Whitfield, IDC interim CEO David Jarvis, including CDC Acting CEO Themba Khoza agreed with Patel’s sentiment stating that progress made so far was in line with their respective organisation’s strategic development goals.

“The construction of this plant is critical to Stellantis’s Dare Forward 2030 strategy. This strategy also speaks to the South African industrialisation plan which is a very important tool in helping us achieve our target to produce a million units in the MEA region by 2030 – a factor that will help us attain 22% market share in this region. 

“Our medium to long-term objective is to ensure that 90% of vehicles sold in the MEA region are sourced from our production plants in this region,” said Cherfan.

The project is a major vote of confidence in South Africa as an investment destination and as a gateway into Africa. 

“We are very proud of being involved in this; the construction of this plant is a major statement of faith in this country and the capacity of South Africans to be entrusted with running a project of this magnitude. 

“This is a factory of which we can all be proud of, not just because of what it will represent to the people of the Eastern Cape, but also because of the technological advances that it will incorporate and the environmentally conscious way that it has been planned, will be built and will be operated,” Cherfan added.

All fauna and flora have been successfully removed from the site and rehomed as per the environmental impact study conducted by Coega.

Coega Acting CEO Themba Koza said: “Coega is focused on delivering the finest plant for Stellantis, reinforcing the Coega SEZ as an automotive hub in the country, in line with its vision to be the leading catalyst for the championing of socio-economic development. 

“The impending construction of the Stellantis factory has acted as a catalyst to other investors. We have had numerous requests to support the automotive sector in Coega and to rapidly grow our planned supplier park.”

IDC’s Jarvis said the new company to house the Stellantis-IDC JV is on track to be registered. 

“The milestones concluded thus far will help to kick start a project that will significantly improve the economic fortunes of the Eastern Cape,” Jarvis said. 

He added that the IDC is pleased to be partnering with such a reputable automotive manufacturing company of Stellantis’s stature. 

“Stellantis’s success with other manufacturing plants around the world is well-known. Together, we are highlighting the IDC’s intent to continually participate and drive investment to develop the regional automobile value chain,” Jarvis said. –