GM PE shock as SA sales, production, to cease

  • End of the line for Chev in Port Elizabeth
  • No clarity yet on staffing for plant
  • Corsa Bakkie and Corsa Lite production ends

PORT ELIZABETH, Eastern Cape – General Motors and Isuzu Motors have announced their respective plans for the Isuzu, Chevrolet and Opel brands in South Africa – and it’s not good news.

The decision will affect about 1500 staff at the Port Elizabeth headquarters and possibly thousands more at Opel / Chevrolet dealers across the country as well as dozens of smaller parts and support suppliers to the plant.

How many will remain to assemble Isuzu products is not yet known.

Essentially…

  • Isuzu Motors will buy GM’s South African light commercial vehicle manufacturing operations and strengthen its presence in the market.

but…

  • GM will cease local manufacture and sale of Chevrolet vehicles in the South African domestic  market by the end of 2017.

Stefan Jacoby, GM executive vice-president and president of GM International, told The Corner through a media release dispatched at around 10.30am on Thursday, May 18 2017:

STEFAN JACOBY: GM executive vice-president and president of GM International. Image: GM
STEFAN JACOBY: GM executive vice-president and president of GM International. Image: GM

“After a thorough assessment of our SA we believe it is best for Isuzu to integrate our light commercial vehicle manufacturing into its African business. We determined that continued or increased investment in manufacturing in South Africa would not provide GM the expected returns of other global investment opportunities.”

READ MORE GM features on Carman’s Corner

Isuzu also announced that it intends to:

⦁ Buy the Struandale, Port Elizabeth, manufacturing plant and GM’s minority shareholding in Isuzu Truck SA to continue assembly of the Isuzu KB bakkies and medium- and heavy-duty commercial trucks there.
⦁ Take over GM’s Parts Distribution Centre and Vehicle Conversion and Distribution Centre;
⦁ Create its own dedicated dealer network to sell, distribute and service light commercial vehicles for existing and new Isuzu customers.

READ WHAT the DA has to say about the withdrawal

Haruyasu Tanishige, senior executive officer for Isuzu Motors sales, added in the May 18 release: “We’re committed to the SA market. The integration of our light commercial and medium- and heavy-duty commercial business will strengthen our base to grow here.

“We will do this through outstanding after-sales and customer support, close relationships with our local partners, and business expansion.”

‘NEXT STEP TOWARDS GROWTH

He added: “Isuzu is building a strong base to grow long-term on the African continent. Evidence of this is our recent purchase of GM’s 57.7% share of East African operations which gave us management control of the company.

“Integrating the South African light commercial vehicle operations into our business is the next step in laying a foundation for growth.”

Isuzu vehicles have been in SA since assembly began more than 44 years ago. For the past four years Isuzu has been No.1 in the medium- and heavy-duty commercial truck segment of the SA market.

READ MORE Isuzu features on Carman’s Corner

GM SA simultaneously announced it would:

⦁ Cease assembly of Chevrolet vehicles for the domestic market by the end of 2017. Talks still to be held with employees and unions

and…

⦁ Continue service and parts support for current Chevrolet owners.

GM, since the recent announcement of the sale of Opel (Vauxhall in Britain) to the Peugeot Citroen Group (PSA), continues to work with PSA to evaluate opportunities for the Opel brand in South Africa.

Existing Chevrolet and Opel owners will continue to be supported.

IMMEDIATE CONSULTATIONS WITH STAFF

GM SA president and MD since June 2015, Ian Nicholls, told The Corner: “These decisions were not made lightly. We appreciate the support that our employees, customers, dealers, suppliers, the SA government and other key stakeholders have given us over the many years that we have operated in this country.

IAN NICHOLLS: Image: General Motors
IAN NICHOLLS: Image: General Motors

“We will manage the transition as smoothly as possible.”

GM SA told employees and unions of the developments before the media release was transmitted and was to begin the formal consultation process immediately. GM SA has established employees’ support centres.

The company added that it would work closely with affected dealers, customer support centre resources would be expanded and all warranties and service agreements, as well as ongoing service and parts requirements for all vehicles would continue to be honoured.

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