China & India Back South Africa to Strengthen Local Auto Industry

New Delhi, Oct 4 (KNN) South Africa has secured pledges from Chinese and Indian automakers to upgrade their semi-knocked-down (SKD) assembly operations in the country into full-scale manufacturing plants, according to Trade Minister Parks Tau.

The government is engaging with multinational firms like Toyota and Ford — along with their suppliers — to shore up the struggling auto sector, which faces falling production, stiff competition from imports, tariff uncertainty, and rising costs of transitioning to electric vehicles, reported Reuters. 

At a recent auto conference, industry leaders warned of potential deindustrialisation if imports are not checked, and urged stronger domestic production.

Tau said that several firms currently operating SKD plants in South Africa have committed to switch to CKD (complete-knocked-down) setups. Under CKD, vehicles are built from parts shipped to the plant, rather than partially assembled kits.

One example is Chinese automaker BAIC, which currently assembles its X55 model under SKD in Gqeberha. That plant is slated to shift to full CKD operations.

In another case, India’s Mahindra currently does SKD assembly of pick-up trucks in Durban. Earlier this year, it partnered with the Industrial Development Corporation to explore building a full-scale manufacturing facility in South Africa.

Tau added that the South African government intends to support these transitions — either by helping existing automakers expand or by attracting new factories to the country.

Over the past two decades, the share of locally assembled CKD vehicles in South Africa’s market has dropped sharply—from 56 % down to around 33 % as of August.

Industry leaders stress that preserving CKD volumes is essential for sustaining local jobs, value‑addition, and South Africa’s position as the continent’s top auto producer—especially now that Morocco is emerging as a strong competitor. 

(KNN Bureau)