Following reports that VW South Africa may be considering the closure of its factory in Kariega in the Eastern Cape, the group’s Communications Head has clarified the German automaker’s position.
Fears arose after Martina Biene, the Volkswagen Group Africa chairwoman, wrote to President Cyril Ramaphosa in December asking for rapid reforms which would allow VW to produce a bakkie locally.
Biene highlighted the threat of surging imports and the rising cost of doing business in South Africa, noting that only one in three cars sold in South Africa is locally manufactured.
As South Africa reviews policy changes, Biene wants the government to consider raising the price threshold to levy an ad valorem tax on cars.
She also suggests adjusting how carmakers use rebates for exporting locally made cars, and introducing policies to grow the domestic market.
In response to her letter, the Chairperson of the Select Committee on Economic Development and Trade, Sonja Boshoff, called on President Ramaphosa to act as a matter of national crisis.
“South Africa cannot afford daily industrial decline, job losses and factory closures,” said Boshoff.
“The report that the Volkswagen Kariega plant in the Eastern Cape faces closure if the Government does not urgently implement critical industrial policy is alarming.”
Boshoff added that South Africa needs to demonstrate leadership immediately to resolve the policy issues highlighted by Biene.
“It would be preferable if the government would finalise the critical industrial policy decisions without delays, and that should include support for the Automotive Industry Master Plan and clear measures to protect and grow local manufacturing.”
VW committed to South Africa
Since these reports, TopAuto reached out to VW South Africa’s Head of Communications, Andile Dlamini, for comment regarding the reported possibility of the closure.
“Our company is not commenting on these reports, some of which were reported without the context of our MD’s statement,” said Dlamini.
“At no point did our MD mention or allude to the closure of Plant Kariega.”
“For the record, 2026 is an important year for Volkswagen as it celebrates 75 years of building and selling vehicles in South Africa.”
VW is celebrating 30 years of local Polo production this year, too, having produced more than 2 million models, and expanding exports to 38 countries.
On top of this, the German automaker has committed to building its Tukan bakkie in South Africa over the next few years.
“We all agree that this would be the next right vehicle for South Africa,” said Biene previously.
“Europe does not need us anymore as an export market, but we definitely also see Africa as a big opportunity. So that would be a car clearly focused on the African continent and exports outside Europe.”
The company could start producing the first units of the Tukan at its Kariega plant in 2029 or 2030, “if all goes well,” she said.
