Ramaphosa Hails Volkswagen’s €200 Million Investment in South Africa

Volkswagen will invest 4 billion rand, or about 200 million euros, to produce a new model in South Africa, a commitment President Cyril Ramaphosa described as a vote of confidence in the country’s industrial workforce.

The Tengo will be assembled at Volkswagen’s Kariega plant in the Eastern Cape alongside the Polo and Polo Vivo. Ramaphosa announced the investment during a ceremony marking Volkswagen’s 75 years in South Africa, held at the factory.

He said South Africa could not take the investment for granted. In a highly competitive environment, he argued, the country must continue demonstrating that it has the skills, capabilities and regulatory conditions needed to attract capital.

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We do not take this investment for granted. In an intensely competitive environment, South Africa must continue demonstrating that it has the capabilities, skills and regulatory environment needed to attract this capital.

Ramaphosa also said the government was reviewing the national Automotive Master Plan to adapt industrial policy to the global shift toward electric, hybrid and other new-energy vehicles. He said South Africa should not only assemble future vehicles, but also produce their components, process required materials and develop related technologies.

The automotive sector contributes slightly more than 5% of South Africa’s gross domestic product, supports more than 115,000 direct manufacturing jobs and exports to 155 international destinations. Ramaphosa also highlighted Volkswagen’s labour history during apartheid, when the company became the first in the sector to recognise black workers’ unions and employ black artisans on production lines.

The Kariega plant, Volkswagen Group’s oldest outside Europe, began assembling its first Beetle on Aug. 31, 1951. Last year, it produced more than 156,000 vehicles and became the only factory in the world to make the Polo exclusively for European and Asia-Pacific markets.

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We are determined to ensure that South Africa remains a key global manufacturing base. We must not only assemble the vehicles of the future, but also manufacture the components, process the materials and develop the technologies they require.