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General Motors exits SA

May 18 2017 13:18
Glenda Williams

While Isuzu Motors will purchase GM South Africa’s (GMSA) light commercial vehicle manufacturing operations, GM will cease manufacturing and sales of the Chevrolet brand in the domestic market, the brand to be phased out of South Africa by the end of 2017. 
GM may be pulling out of South Africa, but Isuzu, which has a four-decade history here, is deepening its commitment to the country and continent.
The newly established Isuzu Motors SA will purchase GM’s Struandale plant and GM’s remaining 20% sharing in the Isuzu Truck South Africa joint venture. It will continue to manufacture the Isuzu KB and medium and heavy-duty commercial trucks in Port Elizabeth. The company will also assume control of GM’s Parts Distribution Centre and Vehicle Conversion and Distribution Centre.
“We are committed to the SA market,” emphasised Haruyasu Tanishige, senior executive offer for the Sales Division of Isuzu Motors. “The integration of our light commercial and medium- and heavy-duty commercial business will strengthen our base to grow here.”
Sales will be effected through a national dealer network of 90, down from the current 132 GMSA dealers in the country.
Isuzu is building a strong base to grow on the African continent in the long term, recently purchasing GM’s 57.7% shareholding in its East African operations.
Production of GMSA’s Spark and Utility models will cease in the coming months but GMSA will continue to provide service and parts support for Chevrolet customers through to the end of 2017, Ian Nicholls, president and managing director of GMSA, said at the announcement this morning. Post January 2018, service support will be provided by Isuzu.
All service plans and warranties for GM brands will be honoured, assured Nicholls.
GMSA has a staff complement of 1 500 but Nicholls could not be drawn on job losses or the number that would transfer to Isuzu.
Nicolls was at pains to point out that the “restructuring” was not based on local political or economic difficulties but rather on the on the assessment that continued or increased investment in manufacturing in South Africa would not provide GM the expected returns of other global investments.
Asked whether Isuzu would be regarded as a new entrant to the market for automotive production and development programme (APDP) purposes, Nicolls said although a meeting regarding the restructuring had already taken place with the minister of trade and industry, that aspect would still require to be worked through with the dti.  
Discussions are also ongoing with PSA Group regarding the Opel brand. It is not yet clear which company will distribute Opel.
GM also announced that its India manufacturing operations will focus on producing vehicles for export only.

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