South Africa: New National Motor Plan Is Geared Up and Ready to Go

analysis

The economy is flat, industrial growth is stuck in limbo and prospects for the sector are poor. Cue government's new SA Automotive Masterplan (SAAM). Will it fuel the results everyone is hoping for?

Despite government oiling the wheels of local vehicle manufacturers with tax breaks, economic development zones and industry masterplans, it has yet to jump-start the state's growth ambitions.

For one, the Automotive Production Development Programme (APDP), which is currently in play, has not succeeded in achieving its 2020 target of producing a million vehicles per year. SA has only managed to make a tad over 600,00 cars per year.

This is despite generous support from the Department of Trade and Industry through its Automotive Investment Scheme - a cash rebate on any investment in local motor production.

The national Budget figures show that after zero-rated goods and services related to value-added tax and the tax benefits enjoyed on retirement savings, the incentives provided to motor makers is the third-highest opportunity cost of the state. In 2018 that was just over R30- billion.

With a decline of 3.7% in local vehicle sales according to the National Association of Automobile Manufacturers of SA (Naamsa) figures, it's arguable that government is...

See What Everyone is Watching

More From: Daily Maverick

Don't Miss

AllAfrica publishes around 700 reports a day from more than 140 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.