Massive R3 billion investment boost for South Africa
Car manufacturer Stellantis has committed to investing R3 billion to build a new manufacturing plant in the Coega region in the Eastern Cape.
The group shook hands on the deal with Trade and Industry Minister Ibrahim Patel after signing a memorandum of understanding over the investment with the Industrial Development Corporation earlier this year.
The investment forms part of the group’s 2030 ambition to sell one million vehicles by 2030 with 70% regional production autonomy.
Stellantis owns popular vehicle brands such as Jeep, Opel, Alpha Romeo, Citroen and Peugeot. The investment also represents a significant boost for South Africa’s local automotive industry, which has the capacity to produce close to 700,000 vehicles annually.
“The country remains a great investment destination, and this commitment from Stellantis to invest in our local motor industry highlights the success of our manufacturing sector policy, its capability and potential. We look forward to welcoming Stellantis to South Africa and sharing in the detailed plan for employment and investment,” said Patel.
The manufacturing plant will be built in the South African Special Economic Zone (SEZ) in Coega situated near Gqeberha in the Eastern Cape province of South Africa.
The greenfield manufacturing project is planned to be completed by the end of 2025. The first launch planned early 2026 is a one-ton pick-up truck with volumes expected to reach up to 50,000 completely knocked down units annually, including export, in line with the industry masterplan, known as the Automotive Production Development Program (APDP).
The plant will be predisposed in terms of space and painting to go up to 90,000 units per year.
Direct employment to support the first capacity step is expected at 1,000 jobs. Stellantis has committed to thousands of hours of training and skills to develop and support the local teams to the level of global standards.
The group said it is targeting a localization rate of over 30%.
“This is a much-needed and welcomed economic boost for the Eastern Cape Province with an anticipated economy-wide impact on the province’s GDP of R664 million. Household income is anticipated to increase to R558.4 million within the Nelson Mandela Bay Municipality (NMBM) and R577.4 million for the entire Province. Most importantly, an anticipated 1,800 jobs will be created in the Metro and around 2,097 for the EC Province,” the province said.
Stellantis said it will continue to work with the IDC in further investments in the country, including more manufacturing plants.
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