Some One Doesn't Quite Get It
10/15/99
My, what an interesting press release.
Note how it failed to mention the U.S.
is is the main left hand drive market.
Also failed to mention how the auto industry
has helped to destroy Africa.
I would have expected Mbeki to understand that
Cars Suck!!!--------------------------------------------------
FOCUS-Mbeki welcomes DaimlerChrysler move
(Updates with comments from President Thabo Mbeki)
By Jeff KoinangePRETORIA, Oct 15 (Reuters) -
DaimlerChrysler (NYSE:DCX - news) said on Friday it would switch production of the right-hand drive model of its 'C' class Mercedes-Benz to South Africa from Bremen in Germany.The company said the move reflected a long-term commitment to South Africa -- which wants to attract long-term investment but suffers from perceptions of crime -- and was part of a broader strategy to specialise operations to gain economies of scale.
President Thabo Mbeki said the decision was an endorsement of South Africa and significant because it showed that those who understood the country were not fearful of making commitments.
``I would hope that the decision by these large motor manufacturers would communicate a message to other people who might have hesitation about the South African economy,'' he told a press conference.
BMW (quote from Yahoo! UK & Ireland: BMWG.F) and Volkswagen (quote from Yahoo! UK & Ireland: VOWG.F) also have production plants in South Africa and make a number of units for export.
Economists said that the news was positive for the country and, because more vehicles put together here would be exported, it could help its crucial balance of payments position.
``It should be a big positive for the economy because it is expanding operations, which implies more fixed investment. Exports will clearly go up because the plants will be adding value,'' said Nedcor chief economist Dennis Dykes.
The car giant said in a statement that it would immediately target annual production of 40,000-45,000 cars and said that the majority would be for export.
``This represents a major challenge for the company and for South African industry in general,'' Christoph Kopke, chairman of DaimlerChrysler South Africa, said in a statement.
PRODUCTION SHIFT WILL FREE UP GERMANY CAPACITY
DaimlerChrysler is shifting production to South Africa to free up capacity in Germany to make left-hand drive cars there. There will be no German job losses.
Kopke told Reuters Television that staffing levels in South Africa would not change, but he predicted it would mean a major increase in employment and investment for its suppliers.
``It will create a tremendous amount of jobs among our suppliers and we expect it to lift investment there by one billion rand ($162 million),'' he said.
Production will go to its East London plant in the country's Eastern Cape province. Exports will be to the main right-hand drive markets, led by Austrlia, and DaimlerChrysler will spend an additional 120 million rand on training.
The company forecast turnover at its South African division to double to 12 billion rand by 2001 from 6.2 billion in 1999 and said that its investment in South Africa would be lifted by 400 million rand to 1.3 billion.
($ = 6.13 rand)October 15, 5:53 am Eastern Time
DaimlerChrysler buys S.African foundry
FRANKFURT, Oct 15 (Reuters) - DaimlerChrysler AG's Powertrain unit has acquired a foundry near Cape Town in South Africa for $26.7 million from Atlantis Engine Corp to produce cast iron for truck engine blocks, it said on Friday.
The Atlantis-based plant will produce around 40,000 tonnes of cast iron a year, helping to prevent production bottlenecks at DaimlerChrysler's Mannheim foundry in Germany, the U.S-German conglomerate said in a statement.
The newly acquired facility employs 700 workers and is expected to generate exports worth $62 million in 1999, the world's fifth largest automaker said.
Powertrain produces and markets engines, transmissions, axels and steering wheels. The unit's biggest customers are Mercedes-Benz commercial vehicles assembly plants in Western Europe.
As a result of the acquisition Powertrain's Mannheim plant will have capacity to develop new ferrous metal materials technology for cars and trucks, the company said.
The Mannheim foundry employs 1,100 people and produced more than 100,000 tons of cast products last year and generated revenues of $147 million in 1998.