Mercedes-Benz South Africa (MBSA) has launched a 600 million euro (approx. R9.47 billion) expansion of its East London plant, describing the investment as a vote of confidence in the country’s new direction. MBSA said the expansion of the plant was a sign of the carmaker’s commitment to South Africa and efforts to revive economic growth.
Divisional board member Markus Schäfer said that the expansion would involve the construction of a new paint shop and a new body shop, an upgrade of the assembly shop and new logistic warehouses.
“With the investment of 600 million euro, we are significantly expanding our plant in East London and equipping it for the future,” Schäfer said.
“The decision to have the new generation of the C-Class built in East London reaffirms the plant and Mercedes-Benz South Africa. The investment is also a sign of our commitment to South Africa and efforts to revive economic growth as well as the socio-economic development of the East London region.”
The expansion is the first major investment since President Cyril Ramaphosa announced his drive to lure $100 billion (R1.35 trillion) worth of investments to South Africa.
Ramaphosa attended the launch accompanied by Finance Minister Nhlanhla Nene and his Trade and Industry counterpart, Rob Davies.
The investment of 600 million euro will be used for a wide expansion of the plant. Many different parts of the plant are affected by the expansion, both green and brownfield. The new body shop is designed for higher capacities and features more than 500 “Internet of Things”- ready robots laying the foundation for Industry 4.0 readiness.
700 tons of steel will be installed for the addition of three lines in the assembly shop. This expansion will take place in the current building. This includes the construction of a new paint shop and a new body shop, an upgrade of the assembly shop and new logistic warehouses. Utilising new methods, the new paint shop will be more energy efficient and more environmental friendly. Overall, the energy consumption per produced vehicle will be further reduced by 25% in the East London plant. This is in line with the plants initiative for a green production. Other examples include an on-site battery storage container, rain water harvesting on rooftops, water storage of one million litres and the creation of green corridors.
Overall the new buildings comprise an area of approximately 100 000m², this reflects an addition of two thirds of the already existing buildings for the passenger vehicle production. The new workshops will incorporate environmentally friendly and state of the art technologies.
Mercedes-Benz Cars will also produce the next generation of the C-Class in East London.
The year 2018 marks the sixtieth anniversary of Mercedes-Benz passenger vehicle production at the East London plant. Over the years, the plant has evolved as a significant contributor to South Africa’s trade balance and an economic multiplier for East London. Furthermore, the plant actively commits to the community of East London and the Eastern Cape. One example is the Mercedes-Benz Learning Academy (MBLA) – a flagship and sustainable Public Private Partnership in cooperation with the National Treasury and the Jobs Fund that demonstrates the commitment of Mercedes-Benz South Africa to empowerment and youth development in the automotive manufacturing sector. Since 2004, MBLA has offered world-class quality training and transferrable skills, qualifying hundreds of skilled artisans in the Eastern Cape.