Report search
Investing in the economy

Metal, Transport and Machinery Products

Overview

The sector has been in distress for the last three years as evident in the number of firms seeking distress funding from the IDC. This is mainly due to the weak global economic recovery and lacklustre demand reducing export opportunities for local manufacturers. In addition, South Africa’s strong Rand relative to the Euro and the US Dollar rendered South Africa’s exports less competitive on the international market. However, the uptake in new deal flows during the year points to a favourable economic outlook and growing market confidence.

Strategy

The SBU offers funding and project development support to ferrous and non-ferrous metal-based manufacturing businesses while focusing on specific sub-sectors as listed on page 30.

The automotive sector has been a strong contributor to national GDP and local employment opportunities. Currently, the automotive components industry is still dominated by imports, representing an opportunity to expand local manufacturing. The SBU is therefore keen to grow the sector further and invest in its industrialisation. The SBU further supports the dti in its efforts to grow the local manufacturing of medium and heavy commercial vehicles.

Performance

The SBU’s impairment figure decreased to 18% from 23% previously.

KLT SA (Pty) Limited Automotive, a subsidiary of the Mumbai-based KLT group, received funding to construct a new chassis assembly plant able to manufacture 120 000 chassis per year.

Read more
An overview of the alternative-fuelled vehicles industry

The SBU approved a working capital facility to I-Wec, a newly formed wind turbine manufacturer based in the Western Cape to ramp up the manufacturing of wind turbine components.

Future focus

Being one of the more mature sectors in which the IDC invests, the sector already boasts reasonably good manufacturing capabilities. The planned capital expenditure earmarked by SOCs will provide further substantial investment opportunities which are expected to grow the economy and boost employment. The SBU is prepared to fund companies that will partake in the SOCs infrastructure development drive.

Read more
A strategic overview of SA’s wind energy components industry

The development of a greener economy will open up substantial components manufacturing possibilities, which the SBU will actively pursue.