Opportunities for the South African Foundry Industry in the Global Automotive Supply Chain

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Abstract:

Two rapid assessments of foundries in the automotive supply chain were conducted in 2012 and 2013 on behalf of the National Foundry Technology Network (NFTN), an initiative of the Department of Trade and Industry (dti). The investigation was not an academic or econometric study; but to identify areas where assistance was required by the foundries, and opportunities for growth. There are both Tier 1 and Tier 2 foundries that are qualified to, and do, supply the automotive sector. Castings, components and sub-assemblies are produced in South Africa for the majority of passenger vehicle manufactures. There has been an increase in volumes supplied by smaller, often Tier 2 & 3 foundries, however, drive train castings are largely imported. Furthermore, there was little evidence of supply contracts for the next model ranges. Local castings were said to be 10% to 30% more expensive than imported parts. Typically, sourcing discussions are made outside of the country, and price and security of supply are main considerations. Original Equipment Manufacturers (OEM’s) have committed to local sourcing, but it was clear that a significant intervention was required to change the downward trend. This would be outside the scope of both the Aluminium Federation of South Africa (AFSA) and the NFTN. It was recommended that a Competitive Improvement Initiative (CII) be launched by the NFTN. This was subsequently approved by the NFTN/dti.

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26-35

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October 2014

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© 2014 Trans Tech Publications Ltd. All Rights Reserved

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