CAR makers have agreed on a new three-year wage deal with a key union, the National Union of Metalworkers of SA (Numsa) — without any disruptions to production.

The agreement held the promise of a longer-term and stable investment planning horizon for SA’s seven vehicle manufacturers, the Automotive Manufacturing Employers’ Organisation (Ameo) said in Port Elizabeth on Friday.

The agreement marks a significant achievement as it is the first time since 2007 and only the fifth time in the history of the sector’s collective bargaining process that it has been successfully negotiated without any disruption or work stoppages.

The employers’ organisation said it offered an enhanced and competitive wage structure and benefits for the industry’s hourly paid workers‚

Among the highlights of the agreement is a housing plan to provide access to more housing for employees at the various manufacturing plants.

"The signing of our new agreement is testament to the value of proactive negotiations between Ameo and Numsa‚" said Mike Whitfield‚ CEO of Nissan SA and president of the National Association of Automobile Manufacturers of SA (Naamsa).

"Formal negotiations were preceded by several consultative industry indabas and a fact-finding mission to the Australian automotive industry by Naamsa‚ Numsa‚ the Department of Trade and Industry‚ the Department of Labour and others.

"The preparations also started earlier this year‚ giving both parties ample time to prepare and consult their constituents‚" Whitfield said.

The local automotive industry is undergoing what the industry calls "very trying times".

New vehicle sales in SA have declined significantly over the past year, and global export contracts remain exposed to a highly volatile local currency and increasing competition from other manufacturing hubs across Europe‚ the US‚ Asia and Africa.

Increased global competition and the possible impact of an unstable planning environment were the main themes of the fact-finding mission to Australia.

Once a large vehicle manufacturer and exporter‚ Australia has seen all of its vehicle manufacturers close their manufacturing plants or prepare for closure in recent years.

Naamsa executive director Nico Vermeulen said: "The importance of the automotive manufacturing sector in SA cannot be overstated. Apart from being the largest manufacturing sector in the country‚ the broader industry also contributes over 7.5% of the country’s gross domestic product (GDP) and an estimated 3.4% of the national wage bill.

"The automotive manufacturing sector is recognised as one of the best paying formal employers in SA and it remains an important driver in the development of the South African economy."

Whitfield said: "The new wage agreement gives us a platform on which we can plan further investment in the sector, and it sends a clear signal to our international parent companies of our serious intent to nurture and grow the automotive manufacturing industry in SA."

TMG Digital