DAIMLERCHRYSLER South Africa has outsourced one of its key production areas, truck assembly, to a black empowerment group. Ikhwezi Trucktech has been established in order to “supply made-to-order vehicles to DaimlerChrysler South Africa at the same stringent standards set for the products in Germany”, says Geoff du Plessis, the management board member responsible for commercial vehicles. The company is responsible for CKD (completely knocked down) assembly of commercial vehicles, including the Mercedes-Benz Actros. Du Plessis said the outsourcing was a meaningful commitment to black economic empowerment that would benefit the East London community. He said a major reason for the move was that the costs of importing FBU (fully built up) units had become too high, mainly as a result of the falling Rand value against the US Dollar and the Euro. It was decided to outsource the CKD assembly of heavy vehicles because the company's strategy is to focus on the high-volume manufacture of Mercedes-Benz C-Class cars and Mitsubishi Colt 1-ton pick-ups. "We had to stop FBU imports because they didn't succeed in meeting our objectives in terms of the MIDP (Motor Industry Development Programme) due to increasing costs," said Du Plessis. "Through outsourcing, we will have the opportunity to assemble a wider range of trucks, including the Mitsubishi Canter.” Ikhwezi Investment Holdings, chaired by Kallie Mabentsela, owns 30 per cent of the new venture, and a company named Sisonke holds a 20 per cent interest. Four top East London businessmen - Willie Gauss, Geoff Shone, Jonathan Goldberg and Peter Bosch, took up the remaining shares.