Although rival BMW announced plans to halt development in the country, Mercedes-Benz said it would push ahead with a 3 billion rand ($302 million) investment plan in South Africa that will see it increase local output to 100,000 units a year.
During an interview at the Johannesburg Motor Show, the truck and luxury carmaker’s South Africa Chief Executive Officer Martin Zimmermann said the outlook for growth in Africa’s biggest economy is “very positive,” and the company will introduce new technology and a third shift to its local plant, which produces about 60,000 units a year at present.
Mercedes’s commitment to South Africa comes less than two weeks after BMW, the world’s largest maker of luxury vehicles, said it would stop expansion in South Africa after the labor strikes cost it 13,000 cars in lost production.
Lost production from the strike that shut down plants in August and September would be recovered by Mercedes in six to seven weeks, Zimmermann said. “We have quite a significant order book,” he said.
South African vehicle sales fell for a second month in September and exports dropped 75 percent as strikes hit carmakers’ operations. Workers at seven manufacturers operating in South Africa, including BMW and Ford Motor Co., went on strike, resulting in an estimated 20 billion rand ($2 billion) loss to the companies.
) - Thursday, October 17th, 2013 - filed under Industry
. Image credit: .
Discuss: Mercedes-Benz planning production increase in South Africa