M a r k e t N e w s

Sigh of relief for SA economy as auto sector signs wage deal with no disruption to vehicle production

Posted on : Thursday, 15th September 2016

 The Automotive Manufacturing Employers’ Organisation has announced a new three-year wage agreement with a key labour union.

 
The wage increases and benefit structure agreement is for the 2016 – 2019 period.
 
The negotiations were concluded in Port Elizabeth on Friday between the automotive manufacturing sector and the National Union of Metalworkers of SA (Numsa).
 
The agreement holds the promise of a longer term and stable investment planning horizon for South Africa’s seven vehicle manufacturers and offers a further enhanced and competitive wage structure and benefits for the automotive industry’s hourly paid workers‚ the employers organisation said in a statement.
 
Among the highlights of the agreement is the creation of a plant-based housing solution that will seek to provide access to more housing for employees at the various manufacturing plants.
 
The signing of this three-year wage agreement is a significant achievement as it marks the first time since 2007 and only the fifth time in the history of the sector’s collective bargaining process that it has been successfully negotiated without any disruption or work stoppages.
 
"The signing of our new agreement is testament to the value of proactive negotiations between AMEO and Numsa‚" said Mike Whitfield‚ CEO of Nissan South Africa and President of the National Association of Automobile Manufacturers of South Africa (Naamsa).
 
"Formal negotiations were preceded by several consultative industry indabas and a fact-finding mission to the Australian automotive industry by Naamsa‚ Numsa‚ the Department of Trade and Industry‚ the Department of Labour and others. The preparations also started earlier this year‚ giving both parties ample time to prepare and consult their constituents‚" Whitfield added.
 
The local automotive industry is currently undergoing what the industry calls "very trying times".
 
New vehicle sales in South Africa have declined significantly over the past year and global export contracts remain exposed to a highly volatile local currency and increasing competition from other manufacturing hubs across Europe‚ the USA‚ Asia and Africa.
 
Increased global competition and the possible impact of an unstable planning environment were the main themes of the fact-finding mission to Australia. Once a large vehicle manufacturer and exporter‚ Australia has seen all of its vehicle manufacturers close their manufacturing plants or prepare for closure in recent years.
 
Nico Vermeulen‚ Executive Director of Naamsa‚ commented: “The importance of the automotive manufacturing sector in South Africa cannot be overstated. Apart from being the largest manufacturing sector in the country‚ the broader industry also contributes over 7‚5% of the country’s gross domestic product (GDP) and an estimated 3.4% of the national wage bill. The automotive manufacturing sector is recognised as one of the best paying formal employers in South Africa and it remains an important driver in the development of the South African economy."
 
Whitfield said: "The new wage agreement gives us a platform on which we can plan further investment in the sector and it sends a clear signal to our international parent companies of our serious intent to nurture and grow the automotive manufacturing industry in South Africa."

Source : www.timeslive.co.za
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