Toyota Revs up South African Manufacturing with R1.1 Billion Ogihara Investment

The South African automotive industry, a fundamental pillar of the nation's manufacturing sector, is set to receive a substantial boost with the announcement of a R1.1 billion investment into KwaZulu-Natal’s (KZN) automotive components manufacturing industry. This injection of capital results from a strategic joint venture between Toyota Motors South Africa (Toyota SA), Toyota Tsusho Africa, and Ogihara Thailand Corporation.

The venture has led to the establishment of Ogihara SA, a company conceived to support the local production of key components for the next generation of Toyota SA’s iconic Hilux bakkie. The newly registered company has initiated the construction of a 32,000 square metre site within Dube TradePort’s designated TradeZone 2, which is primed to uplift KZN's economy significantly.

Ogihara SA’s new plant includes a relocated manufacturing and assembly plant from Thailand, signifying a considerable shift of operations to South African shores. The decision to produce pressed steel components locally marks a transformative step in upscaling the domestic production capabilities while also substantially increasing the demand for locally sourced steel by an estimated 25,000 tons annually.

This venture is lauded as one of Toyota SA’s most significant localisation projects to date, setting a precedent for future large-scale localisation initiatives. With the target set for resuming manufacturing operations by June 2025, the facility's construction is well underway.

Toyota SA President and CEO, Andrew Kirby, emphasized the partnership's importance in enhancing the company's Local Value Addition (LVA) strategy, detailing that the collaboration will not only lead to job creation but also bolster the production quality of automotive body parts within the industry.

Kirby’s sentiments were echoed by Rev. Musa Zondi, the MEC for Economic Development in KZN, who highlighted the strategic importance of this investment in the broader context of South Africa’s steel manufacturing sector. By committing to locally source 90% of steel sheets, Ogihara SA stands as a beacon of hope for South Africa's steel industry, particularly amid the uncertain future of ArcelorMittal's steel plant in the region.

Furthermore, the investment reinforces the economic prominence of Durban's southern automotive manufacturing hub, which contributes around R21 billion annually and employs approximately 20,000 people. The Ogihara SA project, situated in the sprawling 45-hectare Dube TradeZone 2, invites future investment prospects focused on manufacturing and logistics, particularly within the automotive sector.