1. KWAZULU-NATAL TOOLING INITIATIVE Re-structuring of the South African
Tool, Die and Mould-making
Industry
Presented by: Umash Ramkalawon Regional Programme Manager
KZNTI

2. A Public-Private Partnership
KZNTI
A Public-Private Partnership
STRATEGIC DRIVER
TOOLMAKING ASSOCIATION OF SOUTH AFRICA
(TASA)
Support the needs of the TDM Industry
FUNDER
DEPARTMENT OF ECONOMIC DEVELOPMENT & TOURISM
(DEDT)
Aligned to the sector development projects of the DEDT aligned to the IPAP
KEY STAKEHOLDERS
TASA
DEDT
TIKZN
eThekwini Municipality
merSETA
Department of Education
Multi-stakeholder support
Rehabilitation and growing of the Tool, Die & Mould-making Industry in South Africa

3. History of the TDM Sector in SA
% Annual turnover
Capacity
(increasing imports from China and others)
Sector ratio 1%
Automotive (7 OEMs)Automotive (7 OEMs)
Mining & other
BMW
Toyota
Nissan
Volkswagen
General Motors
Mercedes Benz
Ford Motor company
25%
Loss In Local
Tooling
Manufacturing
Capacity
80%
40%
35%
4,6%
Packaging & consumer goodsPackaging & consumer goods
Global EU SA
1990
2010

4. Distress Drivers for the Sector in SA
Critical shortage of Designers, Artisans, Engineers
and Project Managers in the sector.
Radical changes in Skills Value Chain.
Skills Erosion & Job losses
Lack of recapitalization
Lack of focused R&D.
Technology Stagnation
Industry demand growing, Enterprise quantity declining
Loss of Capacity
China, India, EU increased pressure
Loss of Competitiveness
Absence of BBBEE transformation in TDM industry
BBBEE
Increasing imports – decreasing exports
Growing trade deficit

5. Economic Impact of the Tooling Sector in SA
The tooling sector can be classified as a sub-sector under the “Metal Fabrication, capital equipment and transport equipment” sector
High employment and growth multipliers
Strong backward linkages

6. National Intervention in the TDM Sector
The Tooling Initiatives across SA is guided by the intervention programmes set by the National Tooling Initiative(NTI) which has been incorporated into the DTI’s Industrial Policy Action Plan – IPAP( ) as a key action programme for Capital Equipment and Allied Services.
Establishment of TDM Cluster Management structures in 6 provincial locations
Gauteng
- Pretoria
Western Cape - Cape Town
Kwazulu-Natal - Durban
Eastern Cape - Port Elizabeth
Limpopo -
Polokwane
Mpuma-langa - Middleburg

7. KZNTI Strategic Concept
MARKET DEVELOPMENT
SKILLS
GOVT POLICY
SUSTAINABLE ECONOMIC GROWTH
within the
TDM SECTOR

8. KZNTI Intervention Projects
TDM sector skills development
Business capacity expansion
Technology recapitalization
Competitiveness improvement
Cluster structure development
Localisation of international tooling companies

9. TDM Sector Skills Development
TDM Powered Apprenticeship Programme
Pilot programme developed by industry experts and funded by the DTI
The future tooling qualification
526 students at selected FET Colleges across the country
65 students in KZN
Level 1
20 students in Pmb
Level 2
19 Students in Pmb
26 Students in Dbn
Additional intake of 500 students for 2014

10. ….continued

11. Business Capacity Expansion
Tooling Incentive Scheme
Recommended amendments to the current investment incentive structure
of the Automotive Production and Development Programme (APDP) and
the Automotive Investment Scheme(AIS)
AIS
Current capital investment incentive structure ranges from 20% to 30%
It is proposed that this incentive is offered to automotive tooling at a 50% standard rate
APDP
The light vehicle APDP offer's local value addition incentives in the form of a Production Incentive applied for via a Production Rebate Credit Certificate
It is proposed that for tooling local value addition, the benefits apply at the vulnerable products level to provide a significant boost to tooling localization.

12. Rand value of imported automotive tooling used for calculations
….continued
Rand value of imported automotive tooling used for calculations
are as follows,
Historic average of R 2, 227 billion per annum
Forecasted value of R 4 billion per annum
Historic average
(R2 227 million)
Forecast
(R million)
Additional local value added R R
Additional AIS for Local tooling
(R )
(R )
Production incentive
(R )
(R )
Benefit to SA economy R R
Benefit as a % of VA
66%
67%
Extra cost to Govt. for VP incentives per annum
(R )
( R )

13. Competitiveness Improvement
Business Development and Systems Training

14. THANK YOU