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The South African Automotive Industry Essay

1477 words - 6 pages

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 efficiencies and drive innovative features into their products in an effort to attract customers and expand into new markets.
Their challenges also arise as a linkage between them and the suppliers,by means of putting pressure on their tiered suppliers to reduce costs, increase output and quality.Such challenges cause the automotive manufacturers flexible and responsive to customer demand in order to succeed. In recent years the automotive industry has shown a lot of competitiveness (strong competition) in highly competitive markets. The industry is yet to remedy the problems experienced and is still undergoing in the global scale. Issues in regards to robust pressure for price and delivery time cutbacks; quality and overall customer service improvements; environmentally friendly products; a substantial lessening in product life cycles; the rapid introduction of new products; a reduction in the time-to-market and product development costs; the pressure to supply new markets, both in geographical terms and in terms of new products; the solidification of relationships and the strengthening of communication channels(Pires & Cardoza).Other key role players in the automotive industry include Government trade,safety and...

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