The Border Kei Chamber of Commerce (BKCC) believes that the government’s decision to delay the multi-billion rand taxi recapitalisation programme is "potentially disastrous to the economy of the city and region".

BKCC chairman Les Holbrook says that the local DaimlerChrysler plant, which is one of the four automotive manufacturers shortlisted for the programme, will have to wait another for four years to see if it was successful in acquiring a stake in the R18 billion capitalisation initiative. It tendered with its Sprinter commuter bus line.

The recapitalisation programme aims to replace about 97 000 ageing 16-seater minibus taxis with safe, efficient and purpose-built 18- and 35-seaters. It also aims to regulate and empower the industry.

Further, the development of the port of East London and its car terminal importance is dependent on the DCSA contracts and further underlines the importance of this contract and another DCSA contract which is expected to be awarded by DaimlerChrysler’s German parent.

Transport minister Dullah Omar believes that the delay will allow operators more time to find financing for their new vehicles. In the meantime, no vehicle will be refused a license or removed from the road before 2010 on the basis that it did not meet the basic specifications. These include safety requirements such as a roll-bar, a proper chassis and safety belts for all passengers.

Automotive sector leader Zola Tshefu comments:
The Eastern Cape would definitely benefit if part of the contract is awarded to DaimlerChrysler South Africa. The impact will be by way of inward investment and more jobs being created by the assembly plant and new component suppliers. In the light of the delay, there is a possibility that we might lose some suppliers who were considering plants in the Eastern Cape as a manufacturing base, using the taxi project as a foundation for servicing other markets from South Africa.