General Motors recently announced that it is to take a 100% share in the Delta facilities in Port Elizabeth, a move which has been welcomed by players throughout the industry.

The presence of Detroit's “big three” vehicle manufacturers in the South African market is interpreted by the DTI as a vote of confidence in the sustainable future of the local automotive industry, in the country’s industrial policies and in its automotive strategies.

GM's decision is an expression of confidence in the economic future of this country, in the policies of this government and a vote of confidence in this government's Motor Industry Development Programme, which was legislated in 1995, one year after the first democratic elections of 1994.

The involvement by GM in South Africa promises to provide closer links and facilitate new business opportunities for all role-players in the domestic industry. Should expectations be realised for GM to assemble a specific model for export purposes, completely built up vehicle (CBU) exports from South Africa will get a rapid boost. The 2002 extension of the Motor Industry Development Programme (MIDP) to 2012 provides the industry with a ten-year window of opportunity to strategically plan and invest.

The additional benefit offered by trade arrangements such as AGOA should specifically be of interest to GM and other USA companies based in South Africa.

Automotive exports to the USA increased by another 53% to R4, 03 billion from 2001 to 2002 following 270% increase from 2000 to 2001. The R4, 03 billion comprised mainly of CBU exports while just over R100 million was comprised of automotive components.