VW awarded R12bn contract

Wed, 18 Jun 2008

Volkswagen SA has been awarded a R12-billion component export contract, it said on Tuesday.

Company spokesperson Heidi Bantam said the contract was to supply the Volkswagen group with Diesel Particulate Filters (DPF's) for the next five years.

A DPF is a device designed to remove diesel particulate matter.

Volkswagen SA managing director David Powels said the contract was one of the biggest export contracts for a single part ever awarded to the company, adding that it was a "coup for the South African automotive component manufacturing industry".

According to the company the contract will secure over 100 jobs in the Nelson Mandela Bay region in the Eastern Cape where 80 percent of the parts would be manufactured.

Training would also be provided for workers including DPF handling and inspection.

"The skills transfer opportunities from this contract are significant," said Powels.

The company will enter into a partnership with local exhaust systems manufacturer, Eberspacher SA, in producing the parts.

Bantam said both companies would spend about R55-million on tools and equipment to manufacture the parts.

Production of the parts will commence in November this year with parts being shipped to the Volkswagen Group's Kassel plant in Germany.

They will then be completed and sent to various plants in the company's global network.