africa|automotive|components|manufacturing|project|supply chain|training|manufacturing-industry-term

AIDC-EC enters into global partnerships to make auto sector more competitive

11th November 2022

By: Irma Venter

Creamer Media Senior Deputy Editor


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The Automotive Industry Development Centre Eastern Cape (AIDC-EC) has entered into partnerships with the Automotive Component Manufacturing Association of India (ACMA) and the Japan International Co-operation Agency (JICA).

In terms of the agreements, JICA and ACMA will assist the AIDC-EC in rolling out technical training programmes to automotive component suppliers in the Eastern Cape.

The Eastern Cape automotive sector is responsible for 38% of South Africa’s total vehicle production and 50% of the country’s auto exports.

AIDC-EC CEO Thabo Shenxane says that one of the goals of the partnerships is to embed a culture of Kaizen into the supply chain.

Kaizen is a global management method that drives quality and productivity improvement (QPI).

“Kaizen will bring measurable competitive improvement outcomes that will capacitate suppliers to access new markets, attain inter­national benchmarks and develop new oppor­tunities,” explains Shenxane.

“The development of Tier 2 to Tier 4 suppliers will make a major impact on South African Automotive Masterplan 2035 objectives, which target an increase of 20% of locally produced components in vehicles made in the country.”

Empirical results from JICA on Kaizen pro­grammes at eight Tier 1 South African manu­facturers between 2016 and 2019 showed that productivity more than doubled; on-time delivery improved from 73% to 95%; overtime work dropped on average from 13.8 hours a week to 4.6 hours a week; and lead times, on average, improved by 40%.

“The results clearly justify scaling up of Kaizen in the automotive manufacturing sector,” says Shenxane.

“And, like JICA, we believe that South Africa can compete with India’s and Thailand’s automotive component industries – but we must have a vision and plan for this.”

As a key activity of the partnership, the AIDC-EC and JICA are introducing a QPI Kaizen programme to Tier 2 and Tier 3 automotive suppliers across the country’s major auto manufacturing hubs.

“We have started the process to work with 120 Tier 2 and 3 component suppliers over the next three years,” notes Shenxane.

Additional training will also be implemented in terms of the AIDC-EC’s partnership with ACMA, aimed at addressing knowledge gaps and low competence levels through continuous skills transfer.


In terms of the AIDC-EC’s partnership with ACMA, highly structured cross functional skills development and training programmes, blended physical training, cross-country knowledge exchange, simulation techniques, and shopfloor project implementation will be included in training programmes for the Eastern Cape supply chain, says Shenxane.

“It has been noted that suppliers of all sizes have realised the effectiveness of blended learning approaches, where employees have the opportunity of engaging in both hands-on and virtual-based learning.

“This provides unique opportunities for training, and will enhance networking and automotive-related activity between India, Japan and South Africa.”

Toyota Wessels Institute for Manufacturing Studies director Dr Justin Barnes underlines the importance of nurturing the manufac­turing sector in South Africa.

According to Barnes, manufacturing value added per capita barely grew in the 30 years between 1990 and 2019.

Manufacturing contributed 12% of South Africa’s economy in 2019, 17% in 2000 and 21% in 1990.

Moreover, Barnes says South Africa’s manufacturing sector employed more people in 1969 than it does today.

“If we had kept manufacturing at 1990 levels, we would have employed over a million people more.

“The sector is shedding jobs and becoming more capital intensive at a time of an employment crisis. To achieve a high-income society, the driving force is manufacturing productivity and good jobs, whereas the economy is now welfare dependent.”

Barnes notes that the local auto industry has performed better than the manufacturing sector at large, increasing vehicle production from 376 000 units in 1995, to 632 000 in 2019, but adds that the “dark cloud” is that local content has dropped.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor



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