The South African Automotive Industry

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Recommended: Globalization of the auto industry

Much emphasis has been placed on globalization in the automotive industry as a result of the rapid increase in automotive exports. The role of government somewhat distinguishes the automotive industry from other industrial sectors, by means of policy implementation steering its development(Lamprecht 2009:7).The assist of government through the motor industry development program(MIDP),first established in 1995,has acted as a driving force in the promoting of competitiveness and export expansion.The MIDP provided an effective platform for communication and co-operation for all of the relevant stakeholders to interact on automotive issues.The participants in the automotive industry include government,labour and business(Department of Trade and Industry(DTI) 2004).It should be noted that the automotive production development program(APDP) has replaced the MIDP. Since the inception (ADPD) in 01 January 2013,the South African automotive industry entered a period of volume-driven production support.Kehbila ,Ertel and Brent(2009:310) asserted that the industry is the prevalent manufacturing sector in South Africa. SUPPLY CHAIN CHALLENGES IN THE SOUTH AFRICAN AUTOMOTIVE INDUSTRY The automotive industry is critical to the South African economy and/or if figuratively put,the heartbeat of the South African economy. As the industry is big in its magnitude,the challenges faced are also great and vast even somewhat complex if critically analysed.In a global context, vast number of occurrences in the automotive industry encounters a large number of challenges and setbacks.Some predicaments are of OEM’s trying to diminish production and reduce manufacturing costs.They are required to enhance quality, improve styling, escalating organizational e... ... middle of paper ... ...dustry gains by the linkage of it and supply chain management(being supply chain led) as more collaborative approach is provided,knowing no boundaries across firms,including various parties in the supply chain that contribute significantly to improved product quality,shorter lead times,highly responsive supply chain,at lower cost and with increased customer satisfaction levels,and by so doing reveals the significance of the automotive industry.The importance of the automotive industry is largely due to the impact it has on the economy of a country.In terms of South Africa the automotive industry is one of the most influential in terms of its contribution towards of South Africa’s GDP, contributing 6%,accounting for approximately 12% of South Africa’s manufacturing exports, making it an all Important factor in the economy.In 2010,271 000 vehicles were exported.

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