IN A move with the potential to shake up the local taxi market, Beijing Automobile Works (BAW) SA on Tuesday announced the opening of a minibus taxi assembly factory in Springs. It said it expected to move to full manufacturing by 2015.
The local taxi market is relatively small — about 20,000-25,000 units a year — and with the opening of the Springs assembly plant the government is hoping for increased "price competition" and innovation in the local minibus taxi market.
Minister of Economic Development Ebrahim Patel said at the plant opening that the BAW investment was "a concrete step in the move to reindustrialise SA".
"Taxis are a vital part of our public transport system. We require a market that makes affordable, safe and reliable vehicles," he said.
John Jessup BAW SA’s head of sales and marketing said on Tuesday the group had an eye on exporting into sub-Saharan Africa. The market is dominated by the Durban-manufactured Toyota Ses’fikile.
He said the company also would start to import "fully built-up double-cabs and SUVs".
BAW SA is a joint venture between Beijing Automotive Works — itself a subsidiary of the Chinese state-owned Beijing Automotive Industry Holding Company, China’s fourth-biggest vehicle manufacturer — which holds 51% equity, the Industrial Development Corporation (IDC) with 24.5%, with the rest being held by China Africa Motors (CAM), a company owned by James Chung which has until now been importing the BAW minibus taxi known locally as the Inyathi.
Mr Chung has been appointed as CEO of BAW SA.
The IDC said in a statement yesterday that the combined investment was worth R196m and would, including an expanded dealer network, creating about 1,000 jobs.
IDC CE Geoffrey Qhena said the investment "underlines the continued strong co-operation between BRICS countries. The assembly plant is expected to provide many benefits to SA, including increased localisation of the automotive industry and export opportunities".
Mr Jessup said the plant would start off by assembling semiknock-down kits of the Inyathi, a taxi based on the fourth-generation Toyota HiAce (known in China as the Haice).
But it would also begin to assemble the next-generation Haice, codenamed 009, which he said "looks a bit like the Toyota Quantum".
Toyota SA’s Leo Kok on Tuesday said they would not normally comment on competitor’s products, but said Toyota Motor Corporation had "no partnerships" with BAW, either here or in China.
Mr Jessup said the Inyathi would be "rebranded as BAW" as a result of BAW’s investment here and that the first BAW taxis would "roll off the line in January".
He said the plant would eventually have the capacity to assemble 9,600 vehicles a year, but that he expected the company to produce 200 to 300 units a month by mid-year.
Mr Jessup said the company would be "manufacturing for the whole of sub-Saharan Africa," itself unsurprising as Chinese firms look for growth opportunities as their domestic market cools.
He said while there were 25 former CAM dealers at the moment, BAW SA was hoping to expand the network to "35 to 40 dealerships".
Rumour abounds that Nissan SA is in the process of developing a minibus taxi for local manufacture, and that Peugeot is keen to introduce a product locally too.
If that came to pass, given Toyota SA’s 20,000-units-a-year capacity for Ses’fikile at its Durban factory, the market could become extremely competitive or even overtraded.
© BDlive 2012