A PROGRESS report on the development of a massive automotive supplier park on a 1,000 hectare site on the Illovo River banks indicates that the largest government-driven project planned for the south in at least the last decade is on track for construction to begin in July 2019.
Read: City gives automotive supplier park plan the nod
The report by Dube Tradeport, dated 14 March, tracks progress made to date as well as a timeline for the future milestone events as the R11,5-bn development progresses.
Local property developer, Len Brown shared the report with the Sun, following a recent meeting he had with the Dube Tradeport representatives.
While Dube Tradeport’s base is sited adjacent to Durban International Airport to the north of the city and the Illovo site is some 68km away, strategically it is a close 16km to the Toyota car manufacturing plant in Prospecton which it will primarily serve and a short 22km from the harbour.
In manufacturing terms, original equipment manufacturers or OEMs are companies that make a part or subsystem used in another company’s end product. The supplier park is envisaged to become a centralised hub of Toyota’s OEMs, with reputed benefits to these companies including world-class benchmarked facilities, lower cost of goods and distribution efficiencies, better productivity, efficiency and quality, shorter customer order cycles and a road network design which supports all types of articulated road vehicles and provides ample turning circles for ease of access, among others.
Read: Automotive park plan hangs in balance
The document’s indicative implementation programme confirms the land purchase was signed off in February 2016 and a memorandum of understanding agreed upon between Dube Tradeport and the department of economic development tourism and environmental affairs (EDTEA) in mid-2016. The city of Durban’s quest to become an ‘automotive hub’ has seen it partner with the Dube Tradeport and the EDTEA to make it a reality. Head of the city’s development planning, environment and management unit, Musa Mbhele said the three-phase development carries the aim of attracting component manufacturing and car assembly firms.
Mbhele added that the development is expected to create 2,500 jobs during construction and 6,000 permanent jobs after completion. The project, said Mbhele, is a strategic initiative aimed at reducing logistical costs and creating an enabling environment for the automotive sector to thrive. “It is going to centralise production, assembly, sequencing and warehousing facilities that are within proximity to the original equipment manufacturers, such as Toyota and any other new entrants,” added Mbhele.
According to the Dupe Tradeport report, the terms of reference for the project are being bedded down this month, with a focus on technical engineering aspects, including the environmental impact assessment and phase one of the detailed design. Design, approvals, bulk infrastructure and the deal structure is bookmarked to be tackled in the two years from June 2017 and 2019. Construction of phase one is planned to kick off in July 2019, with site availability set down for February 2020.
The automotive supplier park is expected to be fully operational by December 2020.
Read: Deal sealed on R11.5-bn car supplier park
Toti developer Len Brown is especially buoyed by the automotive supplier park development, as he believes the Amanzimtoti area is well overdue for a surge in property prices. Brown said his feeling is residents should hold off if they intend selling properties, in the hope of procuring higher prices when the development increases pressure on the local residential housing market. He is developing several parcels of land in the vicinity of Lower Illovo and the R603, and he’s adamant that this is the most exciting news for the area in decades. “We’ve had nothing like this, and I believe it’s going to affect property prices in a very positive way,” said Brown.
One component of the development is a ‘School of Project Management’ funded by Toyota. The school has a specific focus of building local knowledge and developing technical skill to strengthen automotive trade and ensuring that local people are employed within the sector.
The massive auto development, he said, will play a huge role towards achieving the objectives of SA’s automotive production and development programme, which aims to boost local production to 1.2-million vehicles per annum by 2020. “We are faced with a high unemployment rate and our responsibility is to invest in sectors that make a significant contribution to employment directly and indirectly. As it stands, the Durban Automotive Cluster which is funded by the municipality represents 39 firm members and collectively employs some 17,000 people,” said Mbhele.
Toyota, which invested over R6.1-billion at its Prospecton plant early last year, manufactures some 30% of the country’s vehicles in eThekwini, according to Mbhele. “This investment indicated Toyota’s confidence in eThekwini’s vehicle sector since this was the biggest single investment Toyota has made to date,” he said.
With the municipality’s plans to turn eThekwini to an auto city, the city has set aside R1-million to host the inaugural National Association of Automotive Components and Allied Manufactures (NAACAM) Show from 5 to 7 April at Inkosi Albert Luthuli International Convention Centre. The show, which will be hosted every two years on a rotational basis at major automotive hubs, aims to grow the automotive components and related manufacturing sectors in SA.
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