THE AUTOMOTIVE INDUSTRY DEVELOPMENT CENTRE (AIDC)

Striving to be a leading implementation agency that delivers creative, efficient, best-practice and value-based solutions in support of the government’s programmes related to the automotive and allied sectors

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The agency was initiated in 1997 through a workshop between the CSIR, the DTI, the Fraunhofer Society in Germany and NAAMSA to consider how South Africa could assist and promote the growth of the automotive sector.

“The AIDC was established in 2000 and was responsible for the design and development of the Automotive Supplier Park (ASP) in Rosslyn. The ASP was then transferred to the Supplier Park Development Company in 2004. In 2013, the AIDC and SPDC merged as part of the provinces drive to consolidate several agencies,” Masondo explains, adding that its mission is to provide innovative, customised solutions and to develop the automotive manufacturing sector to globally competitive standards of excellence through a world-class value proposition, which enables effective and sustainable socio-economic growth.

Project portfolio

The AIDC runs a number projects, which contribute to development in the automotive Industry, Masondo enthuses.

Their flagship projects include:

The Automotive Supplier Park

The ASP is based in Rosslyn and spans an area of 130 hectares, with a tenant pool comprising mainly of component manufacturers and suppliers to Original Equipment Manufacturers (OEMs), who require a continuous supply of components to assembly plants. Due to its locality, automotive component manufacturers, suppliers and service providers benefit from synergies and cost-saving opportunities. The AIDC develops factories to tenant requirements on a long-term lease basis. The ASP also offers shared mini-factories for smaller operations and offices for automotive service providers. Masondo says, “Our shared services models offer our clients a soft landing from the day of occupation. Over and above providing space, we take care of security, water and electricity, maintenance and IT services. Our clients only have to focus on running their business.”

Incubation programmes (Ford and Nissan)

The AIDC launched the first automotive incubation centre in South Africa in 2011. The Incubation Programmes Department opened the incubation centre at the Ford Motor Company’s Silverton plant in Pretoria that year. Incubator models have proven to be highly successful globally but are a fairly new concept for South African-based OEMs. The AIDC pioneered the incubation concept within the local automotive industry to provide support to black-owned enterprises and nurture these companies during their start-up phases. The incubation programme is in line with the AIDC’s mandate to create jobs and develop sustainable SMMEs. “The programme benefits start-up businesses by allowing them to operate in the facilities where they receive subsidised rental, mentorship and financial support. After graduation, incubatees are able to establish themselves as fully-fledged businesses in the automotive industry,” says Masondo.

The objectives of the Incubation Programme Department are to:

  • identify individuals with entrepreneurial aspirations and abilities; thereafter, nurture them into successful businesses,
  • provide business support, mentoring and training to the incubatees, and,
  • dentify opportunities in the automotive sector for new components to be included in the incubators with the ultimate objective of increasing local content for the sector.

Winterveld Automotive Hub (township hubs)

The hub plays a pivotal role in upskilling individuals and supporting the growth of local SMMEs with a particular focus on auto body repairs and spray painting. Winterveld has always had a strong, yet largely informal, automotive presence. The purpose of the hub is to expose the local SMMEs to modern auto body repair equipment and methodology and to formalise and develop their businesses by facilitating economic transformation within this area.

Skills Development (Gauteng Automotive Learning Centre and the Trade Test Centre)

The Gauteng Automotive Learning Centre (hereafter, the Learning Centre) was established in 2014 by the AIDC to support the automotive industry. It was established as a world-class learning centre to service the training needs of the automotive and allied industries whilst addressing the scarce and critical skills identified by SETAs. The learning centre’s vision is to become the leading academic and practical training hub for the automotive and allied industries. The learning centre is the conduit for addressing scarce and critical skills in the engineering, technical and trade fields for the automotive and allied sectors.

A successful year

In the past year, Masondo says the agency has enjoyed a number of successes, one of which is the clean audio report—an unqualified report with no matters of emphasis—that they received for the 2016/17 financial year. “This award is evidence of our commitment to running a stable and transparent organisation that is able to account for all its business activities,” he says. Additionally, he says the Institute of the Motoring Industry (IMI) announced that the Gauteng Automotive Learning Centre has successfully met the training criteria to become one of its approved international centres in South Africa. “The learning centre also received a nod of approval from Deputy President, Cyril Ramaphosa when he visited the facility as part of the Human Resource Development Council programme. The partnership between the AIDC and Nissan SA, which gave rise to the learning centre, is one our finest examples of successful public-private-partnerships,” Masondo says proudly.

Competition in the automotive industry

According to Masondo, globalisation has resulted in a challenging automotive manufacturingenvironment that is changing at a rapid pace, resulting in growing competition between international and domestic car manufacturers.

“This has placed cost pressures on producers, requiring them to outsource low-cost manufacturing processes and to place increasing emphasis on quality and productivity measures. This is aligned with the growth that is currently being seen in emerging markets and, in particular, in South America, India, China and Eastern Europe,” he says.

Masondo explains that the local market is mostly foreign-owned and the use of locally-developedtechnologies in the local industry has declined.

“Local assembly plants and vehicle exports also limit the amount of value-add the industry can provide, since local assembly plants use their own technologies that were implemented by their parent companies.

“The competition in the local market has reached a level that has seen some OEMs closing their operations and others pulling their brands out of South Africa recently e.g. GM has closed its operations in PE. SEAT, SAAB, Daihatsu and Citroen pulled out their brands due to, among other reasons, stiff competition in their segments,” he elaborates.

In recent times, however, Masondo says we’ve also seen new entrants into the local markets, including BAIC, a Chinese car manufacturer, which is currently building a manufacturing plant in Port Elizabeth for local and export markets, among others.

Important partnerships

As an agency of the government, the AIDC has various partners to ensure that there is development in the automotive sector. The AIDC has partnered with the following institutions:

  • The City of Tshwane
  • The National Association of Automobile Manufacturers of South Africa (NAAMSA)
  • The National Association of Automotive Component and Allied Manufacturers (NAACAM)
  • The Manufacturing, Engineering and Related Services Sector Education and Training Authority (MerSETA)
  • The Department of Trade and Industry
  • BMW
  • Nissan

“These partnerships create an enabling environment for the AIDC to roll out its projects,” Masondo explains.

Meet the CEO

David Masondo graduated with a BA Honours degree and a Master of Arts degree from the University of the Witwatersrand. Thereafter, he obtained his Doctor of Philosophy from New York University.

In 2005, he became a lecturer at the University of the Witwatersrand, where he taught various political courses for three years.

He was appointed as a Finance Member of the Executive Council for the Limpopo government’s Provincial Treasury in 2011.

During his two years in this role, he led the process of budget allocation through the provincial budget committee and provincial legislature, he monitored the provincial government as well as the Provincial Treasury Accounting Officer’s implementation of the operational plan.

In 2014, he was appointed Chief Director: Economic Sectors and Industry for the Gauteng Department of Economic Development. He was tasked with a number of duties including providingstrategic direction in the development of industrial sectors, providing value-chain analysis and success factors of defined industries in Gauteng and identifying possible opportunities, documenting the interests of various role players in different industry sectors as well as risks associated with being in those industries.

In 2015, he was appointed the AIDC’s Chief Executive Officer—a role he presently holds—and has gone from strength to strength in terms of providing his impressive expertise and effective leadership. 

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