Namibia: Big Potential for Namibia's Auto Industry

NAMIBIA'S automotive industry is still developing but the country's geographical location makes it an attractive destination for vehicle manufacturers.

These are the research findings presented by Labour Resource and Research Institute Namibia executive director Michael Akuupa at a virtual presentation on Wednesday.

The presentation also marked the launch of the report 'New Investment in the Automotive Sector in Sub-Saharan Africa', where labour educator Herbert Jauch was the moderator.

"The Namibia automotive industry is still underdeveloped with active market players only in retail and aftermarket services such as panel beating and motor repair services," said Akuupa.

He added that the set-up of the industry allows for informal businesses providing motor mechanic services, although there are no records detailing how many informal automotive businesses are in operation in the country.

"Any business that is not registered with the Ministry of Finance, ministry of trade, Social Security Commission or any other trading authority, and does not pay tax is considered informal," he said.

Akuupa said while the country's regional integration agenda and existing policies on trade and development are being reviewed by the Ministry of Industrialisation and Trade in order to incorporate manufacturing as a necessity for the automotive industry, there are still some challenges in the sector.

"Salaries are lower than the estimated living expenses, and women are paid less than men. The mean salaries for females are N$3 338 while that of males are N$4 623 a month. This gap needs to be reviewed," he said.

The research found that there is also a need to eradicate racial bias regarding positions, payment and conditions of work.

"Workers with no union representation have no bargaining power and are left at the mercy of the employers and state law enforcement agencies, that may not adequately protect them," Akuupa said, adding that the sector only has 5 808 union members out of an estimated 80 852 formally employed workers.

He said legislation review is needed to ensure new investors uphold the state standards of investments, business and employment.

"Namibia also needs to improve the education system to change the mindset of graduates and promote more vocational training programmes."

He also recommended that strong political strategies to secure minimum wage agreements should be implemented.

IndustriAll Global Union's regional officer, Kenneth Mogane, presented a regional perspective on investment in the sector.

He said the automotive industry is an important sector, that can play a role in the industrialisation of the continent.

"Sub-Saharan countries produce raw materials that are needed in the manufacture of motor vehicle engines, tyres and petroleum products that fuel the vehicles.

"It is estimated that in the next 15 years, the middle class in sub-Saharan Africa will reach 340 million and so there are possibilities of growth in the market for new vehicles inclusive of luxury vehicles," he said.

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