1. South Africa’s Component Manufacturing Landscape: Challenging the Past to improve the future. Dr Johan van Zyl President : NAAMSA CEO Africa Region: Toyota SA Motors 2014-10-14

2. World Leader in fiscal policies and fiscal compliance What we Know ……. Fundamental requirements for economic growth Source: www.tradingeconomics.com Labour Cost is Worst of BRICS

3. Find our Competitive Advantage      

4. Weakness  Build to print industry  Assembler culture  Limited skills and resources  Low local content (value added)  International not competitive Strength  Wide supplier base to the 7 OEM‘s  Availablity of basic raw materials  International certification of management systems  Strong automotive assembly experience Threat  Political situation  High crime level  Free capacities in Asia and Europe  Monopoly situation of suppliers  Price increases Opportunities  Export of single components  Local OEM‘s to use common suppliers  Localisation of current CKD parts  Currency development  APDP / BBBEE  IPAP Initiative to support supplier Strength lies within…. SWOT Analysis  Availability of basic Raw Materials Mineral Resources is Key

5. Why…….. Our Resources LCR = 98% Example – LA Batteries CIM<1 LCR = 35% LCR = 58%LCR = 41%LCR = 4% Beneficiation = Biggest Opportunity

6. Scenario…….. If reduced by 10% Beneficiation: 103,000t / year R 2.5 billion / year Beneficiation: 103,000t / year R 2.5 billion / year

7. 7 Commodity Pricing Why Import Parity? Pay US$ for ZAR Cost base? Beneficiation Technology Support Collaboration Investment Skills Automotive Growth Competitive Localisation Items to Fix……..

8. Thank You