Ford Motor Company decided to pump about $ 1.05 billion into its plant in South Africa, its largest investment ever in the country, as it curtailed its business in other regions, including Brazil and Europe.
The company said in a statement on Tuesday that the development of the “Silverton” plant near the capital, Pretoria, would boost its annual capacity by 20% to 200,000 units and create about 1,200 direct jobs as well. The development will also support the production of a new “Ranger” pick-up truck from 2022, which will be exported and sold locally.
This step comes after the company, “Ford” announced last month that it would stop production in Brazil after a century of car manufacturing there, to close three factories, as well as laying off 5,000 workers.
The Michigan-based company has also cut thousands of jobs in Europe as part of its $ 11 billion global restructuring process, while it laid off 1,400 employees in the United States in 2020.
Automobile manufacturing in South Africa
In a speech at the Silverton factory site, the President of South Africa, Cyril Ramaphosa, said: “This will help us expand and transform our manufacturing base in our country. Our plan is a clear statement of the company’s confidence in this development and in its ambitions for its business in South Africa.”
New Ford investments and jobs will boost business in unemployment in South Africa, nearly a third of the workforce.
The country has been hit hard by the Corona pandemic due to the closures, and the resurgence of infections that weigh on economic activity, and it is likely that the contraction of economic output for 2020 will be the largest in the country in at least nine decades.
Nevertheless, the auto industry was one of the country’s most successful stories, with global automakers operating, including: Toyota Motor Corp., Volkswagen AG, and BMW AG.
The companies are benefiting from a manufacturing incentive scheme that extends to 2035, while Nissan Motor Co and Mercedes-Benz subsidiaries of Daimler AG have announced additional domestic investments in recent years.
The Ford Ranger was among the top three light commercial vehicles sold in South Africa last year, while nearly 46,000 units of the locally manufactured model were exported around the world, making the car one of the two most shipped from the country.
Production will include the Silverton plant, which also manufactures the Everest SUV, and VW pickup trucks, as part of the strategic alliance between car manufacturers. The partnership agreement was signed in June, nearly two years after it was first announced, and has since been expanded to include electric and autonomous cars.
Ford said, “Silverton” will operate completely off the grid by 2024, which will protect it from frequent power outages in South Africa.