More than 1.5 million vehicles and industrial vehicles and 2.five million engines are developed in the UK every year, accounting for 10% of the UK’s total exports. The South African automotive business compares favourably with related industries in building nations with regard to infrastructure, raw material availability, emerging-market price positive aspects, flexible production capability and government help. Automotive assembly plants have to import as well numerous components as there is a lack of nearby suppliers in the markets (Ambe & Badenhorst-Weiss, 2011 Pitot, 2007).
This challenge certainly leads to high costs of new cars in South Africa and tends to make South Africa’s automotive makers globally uncompetitive and consequently influences automobile exports. At the very same time, the automotive sector continues to be presented with tighter regulation, both on vehicle security and environmental problems. Primarily based on the outcomes, it is evident that the South African automotive industry is challenged in its marketplace and solutions hence the require to improve service levels and explore new and emerging markets for exports. In mature markets, automotive firms faced stiff competition and demanding consumers (Afsharipour, Afshari & Sahaf 2006:five).
The outcomes show that information technologies is very utilised by the majority of the neighborhood companies in the South African automotive market. The business is also one of the biggest investors in investigation and development (R&D), thus playing a key part in society-wide technological improvement (Commonwealth of Australia 2008 Organisation Internationale des Constructuers d’Automobiles OICA 2009).
Price challenges (which incorporate higher fuel cost, operating expense, cost due to delays at ports and higher prices of components and supplies) impact the performance of the sector and its competitive position worldwide. Traditionally in the automotive industry, supply chains revolved primarily about producing supplier collaboration and manufacturing operations more efficient (Lam 2008).
Capacity, abilities and labour concerns were also identified as challenges impacting the overall performance of local automotive manufacturers in South Africa. Allianz’s Center of Competence for automobile makers (aspect of Allianz Versicherungs AG ) coordinates car or truck insurance coverage schemes for worldwide automobile manufacturers through its worldwide automotive group.