SABC News - General Motors ceases operations in South Africa:Thursday 18 May 2017

General Motors ceases operations in South Africa

Thursday 18 May 2017 15:23

Olwethu Matsipane

GMSA president, Ian Nicholls says the manufacturing of Opel brands and Chevrolet will be phased out before the end of the year.

GMSA president, Ian Nicholls says the manufacturing of Opel brands and Chevrolet will be phased out before the end of the year. (SABC)

General Motors South Africa has announced that it will stop operations in South Africa, and its light commercial vehicle manufacturing operations will be purchased by Isuzu.

Briefing the media in Port Elizabeth, GMSA president, Ian Nicholls says the manufacturing of Opel brands and Chevrolet will be phased out before the end of the year.

The exit of General Motors from the South African market is part of the company's plans of restructuring its international operations to improve its overall financial performance.  

However this restructuring will have a negative impact on the employment sector.

General Motors South Africa started offering retirement packages to its employees, last year.

Currently the company has one-thousand-500 employees, but it's not clear how many will be affected by these changes.

The president of General Motors South Africa, Ian Nicholls says, “We will be entering a formal consultative process with the employees and their representatives, seeing that we have just informed the employees of the proposed restructure. It’s premature for me to comment on what the outcome of that would be as it is part of a process in line with employees and their representatives.”

South Africa is not the only country affected by these changes, as General Motors International also announced restructuring of operations in Singapore.

Vice President of General Motors International, Ritch Schaafsma elaborates, “This is strictly a global decision based on where GM thinks we can get the best return on our investment going forward.”

Isuzu Motors will purchase GM's local operations and the minority shareholding GMSA held in Isuzu Truck SA, while Isuzu bakkies and trucks will continue to be produced in Port Elizabeth. They will also set up a network of 90 dealerships in the country.

Isuzu says they are confident that the move will be a success and might lead to future investments in the country.

Senior Executive Officer of Isuzu Motors, Haruyasu Tanishigesays, “South Africa is an important market for us, and the African continent as well, as you know we have been here for 44 year and people know the brand and customers love the Isuzu brand. We are looking here in South Africa for big opportunity for us to grow.”

NUMSA General Secretary, Irvin Jim says the changes were not properly communicated and they're concerned about the security of members' jobs.

“We will obviously as NUMSA check all aspects, whether the competition commission was informed about this, and we will explore what legal recourse do we have in the interest of our members. We will fight back.”

General Motors has promised to honour their contracts with the components companies they worked with.  

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