SA tyre manufacturing receives R970m boost

Dunlop truck and bus radials start rolling off Ladysmith plant

Sumitomo Rubber South Africa (Pty) Ltd (SRSA), manufacturer of the Dunlop, Sumitomo and Falken tyre brands, officially launched its new 488 622m2 truck and bus radial (TBR) factory in Ladysmith, KwaZulu-Natal yesterday (Tuesday, 02 October 2018).

VIP guests, stakeholders, dignitaries and members of the media were given an opportunity to tour the TBR factory. They included government and industry representatives together with President and CEO of Sumitomo Rubber Industries (SRI), Ikuji Ikeda, who delivered an address and unveiled a plaque to mark the opening of the facility.

This second phase of SRSA’s multi-billion-rand investment to upgrade and modernise the plant’s capacity saw a further injection of R970 million to introduce and manufacture truck and bus tyres locally, bringing the total investment into the Ladysmith facility since 2014 to more than R2 billion.

The occasion marks the first time that SRI has established a truck and bus radial factory outside of Asia, from where these tyres were previously imported.

Mr Ikeda said the reasons for proceeding with the investment – despite the challenges of developing a TBR factory from scratch – included the African market’s potential and particularly the Free Trade Agreement which, he believes, will support SRI’s business initiatives on the continent.

He added that local TBR tyre production would result in the expansion of business for truck and bus vehicle manufacturers and present opportunities for government related businesses.

The plant has also been assisted by the government’s Auto Incentive Scheme, which is designed to grow and develop the automotive sector through investment in new and/ or replacement models and components that increase plant production volumes, sustain employment and/ or strengthen the automotive value chain.

The initial target is to produce 780 TBR’s a day within the next year and in excess of a 1 000 TBR’s a day once further investments in equipment and training are made. R30.5 million has already been spent by SRSA on training staff at the plant.

Ikeda stated that 19 TBR employees had been sent for training to the company’s Miyazaki factory in Japan, where they were able to develop their technical methodology and gain an understanding of SRI’s processes in order to transfer this knowledge to shop floor staff in South Africa.

Around 400 permanent jobs are planned to be created and sustained at the plant by the end of 2019.

CEO of SRSA, Mr Riaz Haffejee outlined the vision and purpose of the TBR facility and the range on offer. “We will be industrialising a total of 24 sizes between our Dunlop and Sumitomo brands, from this year until September 2019,” he said.

While he believes the TBR market potential in South Africa and Africa was large (3-5% year-on-year growth predicted), he also conceded the tyre market was highly competitive. Much of this competition came from importers. He described South Africa as a sophisticated tyre market.

TBR production at the plant commenced as planned in July 2018, following a rigorous testing phase in seven African countries which included tests in various fleets, applications and regions.

The local production of the TBR range – following extensive research and development processes – will ensure that customers, both in South Africa and on the African continent, have the right tyre for the country’s specific application.

These will be designed in Japan, tested in Africa and manufactured in South Africa, for Africa with the Ladysmith factory certified to test TBR tyres to European compliance standards.

Haffejee explained that SRSA was currently building up stocks and was continuing with development, which would proceed for the next 12 months.

He added that Dunlop TBR’s ideally needed to be supported by sales and technical support, 24/7 servicing, mobile servicing and retreading. However, the company is not currently performing retreading at all.

While SRSA is working with various truck and bus OEM’s to supply them with new Dunlop TBR’s, more testing is required before major deals can be concluded. According to Haffejee, a 12-man technical support team has been assembled to support fleet buyers and provide professional technical advice and service.

He added that SRSA was lobbying the National Regulator of Compulsory Specifications (NRCS) and the South African Bureau of Standards (SABS) to develop standards for used tyres, retreads and tyre wear rates.

The Ladysmith plant (founded in 1973) currently produces passenger car, sport utility vehicle and light truck tyres, which are sold in South Africa and exported across Africa and other countries.

The Ladysmith plant was bought by Apollo Tyres in 2006 and sold to SRI in 2013. It makes use of some of the equipment previously used by Apollo South Africa having first undergone a refurbishment process in Port Elizabeth.

SRI is situated in Kobe, Japan, and is ranked the world’s sixth-largest producer of automotive tyres and industrial rubber products and has tyre manufacturing plants in Japan, China, Indonesia, Thailand, Brazil, Turkey, USA and South Africa.

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