With one in five vehicles on South African roads fitted with locally produced Dunlop tyres, the tyre manufacturer is now preparing to forge ahead with a multi-billion Rand investment project backed by its Japan based parent company, Sumitomo Rubber Industries (SRI).
According to the company, it aims to bolster local tyre production capacity to cater to the increasing demands from Original Equipment Manufacturers (OEMs).
Moreover, the R1.7 billion investment drive was announced during the 50th anniversary celebration of Dunlop’s Ladysmith manufacturing plant. The facility, which opened its doors in October 1973, has remained at the forefront of tyre production in South Africa. Sumitomo Rubber South Africa (SRSA), the local arm of SRI, not only manufactures Dunlop tyres but also distributes the Sumitomo and Falken tyre brands.
Minister of Trade, Industry and Competition, Ebrahim Patel, visited the plant on Monday, 2 October 2023, and underlined the significance of this investment in stimulating economic growth and development in Ladysmith.
This substantial investment will serve as a robust pillar, bolstering local production and fortifying the output of the factory. Furthermore, it is a big step towards the modernisation and enhancement of the plant facilities, ensuring the support and creation of local jobs, and contributing to the economic prosperity of the region.
“It will provide a boost to local production and strengthen the output of the factory, supporting local jobs. The new investment will help to modernise and improve the plant. It is also a step towards the R2 trillion target that President Ramaphosa has set for new investment over the next five years,” Minister Patel stated.
He added that the investment is a signal of the confidence that international investors have in South Africa and the progress we have made with the South African Automotive Masterplan.
Minister Patel also emphasised the pivotal role of the Automotive Masterplan in supporting this investment. The Masterplan is a collaborative initiative where the government provides incentives for both the assembly of cars and the production of components in South Africa.
This partnership, encompassing investors, workers, regulators, and policymakers, is founded on mutual contribution and benefit, reinforcing the commitment to bolster local production and ensure the growth and sustainability of the domestic market.
Minister Patel explained, “In alignment with the objectives of the Masterplan, government has taken action against unfair trade practices that undermine local production and employment.”
He highlighted the approval of antidumping duties ranging from 7% to 43.6% on dumped imports of passenger, truck, and bus tyres from China, a significant move to protect and support local industries and jobs.
Minister Patel reaffirmed the government’s support and commitment to continue working with investors and workers to ensure the sustained growth, development, and prosperity of the South African automotive industry and the economy at large.
Ushio Shigeru, Ambassador of Japan to South Africa, expressed his support for the future of the country’s automotive industry and applauded the government for its initiatives in expanding the electric vehicle production and market.
“The Embassy of Japan has been a great supporter of Japanese company activities here in South Africa. It is a pleasure to see Sumitomo Rubber’s further successes in its local operations, which has brought skills development and local youth empowerment,” he said.
SRSA CEO, Lubin Ozoux, said the milestone anniversary for Dunlop comes at a critical time. “With the backing of our parent company, we are investing significantly into our passenger car radial production facility to make a larger impact in the automotive industry. The plant will be able to run a wider set of products, producing more tyres that meet and exceed OE specifications, and that are safety tested for all South Africans. At the same time, it gives us the opportunity to continue our investment in our local community and municipality, creating a vibrant environment for us all to thrive.”
Dunlop holds approximately 20% of the local OE market and has agreements in place with major vehicle manufacturers, resulting in one in five vehicles on South African roads being factory fitted with Dunlop tyres produced at the Ladysmith plant.
The extensive investment covers new plant equipment and machinery, including a new mixer, new tread line, and new sidewall line. This will increase passenger car tyre production capabilities, efficiencies, and product offerings to further support the OE market.
This investment builds upon SRSA’s previous multi-billion rand investment in 2018, establishing a state of the art Truck and Bus Radial (TBR) factory at the plant, reinforcing local manufacturing of truck and bus tyres.
In line with global environmental concerns within the automotive industry, Dunlop’s new high spec, technology driven equipment and optimised production processes will reduce the plant’s environmental impact.
“The new equipment will improve current process capability and decrease our overall plant waste by over 60% once the investment is complete. Power consumption will be significantly reduced, and the equipment will also have the capability to produce very low rolling resistance tyres that will meet help meet future emissions requirements for OE manufacturers who choose to use our products. Our new mixer, with improved technology, will result in an energy saving of approximately 300KWH,” said Ozoux.
Furthermore, this latest investment firmly establishes Dunlop as a prominent employer in the region, emphasising its commitment to the local automotive manufacturing sector.
The company has actively contributed to job creation, employing over a thousand people between 2014 and 2023, with a strong focus on the local community and municipality.
As Dunlop anticipates substantial development and growth resulting from this investment, stakeholders and the community eagerly anticipate the positive impact and prospects it holds for the OE manufacturing industry and the local economy.
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