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Volkswagen’s international passenger car CEO Thomas Shaefer caused a stir over the weekend by saying SA must get its political and infrastructural act together or risk losing major foreign automotive investments.

While his comments served as was a wake-up call to government, they did not portend the imminent demise of Volkswagen SA’s 80-year old car factory in Kariega, nor the loss of nearly 50,000 jobs in the brand’s total supply chain, said Volkswagen.

“We are not leaving,” Martina Biene, MD of Volkswagen SA, told Motor News on Monday.

She said the Kariega plant is committed to building Polos for the local market and export until 2028, as well as the Polo Vivo for SA until 2027, and a new compact SUV will be added as a third model at the factory, as announced earlier.

The new model has not been named but Biene confirmed it will be a small crossover built on the Volkswagen MGB-27 platform that underpins the Polo, T-Cross and Taigo. She hoped to give further details early next year.

Biene reiterated Schaefer’s concern with SA’s regulatory, energy and logistics crises which pose a threat to local production facilities.

“The ports are stuck, you can’t get the materials in, we have to cancel shifts because there is no electricity,” Schaefer said while visiting SA last week, which made him “very worried” about the future of the automaker’s SA operations, but he said the brand’s plant is safe for now.

Biene said the Kariega plant is scheduled to build 163,000 cars next year and load-shedding is a major challenge. The company has spent R130m over two years on generators and diesel to keep the plant running during power cuts, allowing VWSA to build 8,000 more cars this year compared to 2022.

Biene reiterated her call for government to announce its long-delayed electric-vehicle policy, which was required to future proof the country’s car manufacturing industry.

Government has missed several deadlines to announce a policy, which could include incentives that will be crucial to the survival of SA’s car and bakkie manufacturers who produce for export. 

With the global shift to more planet-friendly cars, local manufacturers will soon need to switch from producing internal-combustion engine (ICE) vehicles to new-energy vehicles (NEVs), which include hybrids and electric vehicles.

The motor industry has been engaging with government on the issue since May 2021. Finance minister Enoch Godongwana recently said a policy will be set out in February 2024’s budget speech.

New models

In addition to the locally-built small SUV, Volkswagen SA announced several new imported models will be introduced in the country next year including the all-new Tiguan midsize SUV, an updated T-Cross small SUV and a facelifted Touareg large SUV.

The company is also looking to introduce a high-performance 222kW petrol turbo model to the recently-launched Volkswagen Amarok bakkie range, which is based on the Ford Ranger and built on the same production line at Ford SA’s Silverton factory in Pretoria. The Amarok is only available locally with diesel engines ranging in power from 110kW to 184kW.

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