Replacing imported automotive products with locally manufactured finished goods and components is a growing reality, states local supplier KLT Automotive and Tubular Products South Africa CEO Ashok Thakur.

He adds that substitution of imported products in favour of locally manufactured goods is now a viable alternative.

“From being a dedicated supplier to only one motor company, KLT has created additional capacity and is currently serving four original-equipment manufacturers (OEMs) in South Africa, based on the quality of our locally produced products and professionalism. KLT has been successful in setting up and running a business in South Africa, creating a vibrant ecosystem and skills to support automotive manufacturers,” Thakur explains.

KLT Group is a chassis and tubing supplier in India, with customers such as automotive companies Tata, Mahindra, Daimler, Ashok Leyland and Volvo/Eicher and operates 11 plants. KLT Automotive South Africa, a subsidiary of KLT Group, currently employs more than 700 people and is the only chassis manufacturer outside of the OEMs located in Africa.

“The viability of local import replacement has been spurred by shipping delays on imports, price increases in both sea and air freight, and the negative effects of a lowering in worldwide manufacturing capacity as a result of the pandemic. On the supply side, the high quality of locally produced components now makes local procurement a viable alternative. As a result, KLT is seeing significant opportunities in the local automotive industry.”

He adds that KLT is further committed to increasing capacity, and that over the next three years the company is targeting doubling its business, which will result in both organic and inorganic growth.

Thakur believes that recent regulatory changes relating to local content have provided an opportunity for automotive component companies.

“While all OEMs are aggressively looking at increasing their local content, KLT is already in discussions with five of the seven automotive manufacturing companies for more localisation. We have locally created skills through which we are able to produce components with high local content.”

KLT Group chairperson and MD Jubin Thakkar says the group remains committed to strengthening its footprint in South Africa and other African countries and will continue to invest in new technologies and skills development as it grows its African business interests.

Thakkar adds that KLT is looking to expand its business, and is noting significant interest from industries such as mining, power, agriculture and consumer durables. These are markets where KLT is able to provide locally produced chassis and tubular components.

“The KLT Automotive story in South Africa is a perfect example of how global companies are responding to the policy constructs of the South Africa Automotive Masterplan 2035, and we wish them well in gaining more local production opportunities,” states National Association of Automotive Component and Allied Manufacturers executive director Renai Moothilal.

Thakur notes that automotive sales in South Africa have grown by over 30% this year, which is a good sign for the local automotive industry, boosted by improving local economic indicators.

“With South Africa moving to Level 1 lockdown regulations, it has enabled the economy to open up.