By Nangamso Mabindla
7 September 2007

PRESIDENT Thabo Mbeki was in town yesterday, where he opened the new DaimlerChrysler plant and witnessed the launch of its new super car.

The automotive industry contributed 7,53 percent to the country's gross domestic product, making it one of the key growth sectors for the country's economy, he said. And as home to the DaimlerChrysler plant, East London was one of the most economically important nodes in the country.

Mbeki was speaking at the launch of the new plant and its fourth generation Mercedes Benz C-Class, the W204, at the DaimlerChrysler complex in East London on Thursday, 6 September.

Buffalo City Executive Mayor Zintle Peter; Premier Nosimo Balindlela; cabinet members; the chairperson of DaimlerChrysler South Africa, Hansgeorg Niefer; the former DaimlerChrysler AG board chairman, Jurgen Schrempp; and business representatives also attended the event.

The president thanked the multi-national car maker for the faith it had shown in East London, the country and its people. The area had become famous for manufacturing top-class vehicles. The manufacturer has invested R1,9-billion in improving the East London plant's infrastructure, the construction of new buildings, the development of new tools and state-of-the-art equipment.

"Indeed, DaimlerChrysler has been part of the process of ensuring that this region becomes a major manufacturing industry, especially through increased investment and skills development."

Mbeki said that he was aware of the importance of the automotive sector to the growth of the country's economy. "Our government has formally taken the decision that in terms of our industrial policy, we must encourage and support the automobile sector as one of the leaders in our process of radical expansion of our manufacturing sector."

Despite boasting one of the world's leading automotive industries, the country still had a serious skills shortage. Mbeki said that to combat this, the government, together with the private sector and the universities, had in place a comprehensive plan to build the necessary skills-base in all areas critical to the growth of the economy.

"Through the Joint Initiative on Priority Skills Acquisition [Jipsa] we are all committed to fast tracking the process of skilling the South African workforce for faster economic growth and social development."

Other challenges facing the automotive industry included the affordability of vehicles and employment; the president said that the government had a programme to tackle these challenges.

"Since 2005, the government has been reviewing the Motor Industry Development Programme [MIDP] … to evaluate the performance of the industry against the MIDP's stated objectives; that is, making vehicles more affordable, growing exports, rationalising production platforms and stabilising and growing employment."

The minister of trade and industry had indicated that the government was "determined to complete, by December, the [review] to outline a support programme for the industry to be implemented after the current MIDP expires in 2012".

Speaking about the quality of the new luxury car, the president said that he was proud that it was assembled in South Africa. Its class and elegance communicated a message that South Africans were capable of making products of the highest quality.

Talking about the new C-Class, Niefer said that it was the most technologically advanced product the manufacturer had built at its Buffalo City compound.

"It is our ticket to the future that has been bought and paid for by many. We know that South Africa will reap the rewards of economic growth, skills and technology transfer, supplier development, black economic empowerment, job growth and global respect," he said.

Mercedes Benz's chief operating officer, Rainer Schmueckle, said that the production of the C-Class would have many spin-offs for the country. "The C-Class is one of our most popular cars and we are now going to be exporting left-hand drive models to the United States, our biggest market in the world. This will, in turn, create jobs for the people of the country."