Is S.A’s automotive industry heading for a strike? - CNBC Africa

Is S.A’s automotive industry heading for a strike?

Southern Africa

by CNBC Africa Reporter 0

Is S.A’s automotive industry heading for a strike? Photo: Wikipedia

The Secretary General of South Africa’s Motor Industry Bargaining Council (MIBCO) says he is "positive" the industry will not strike this year as it proceeds with negotiations between the industry and unions.

Tom Mkhwanazi expressed his confidence at a round table discussion with media about the challenges the industry is facing and driving the point that the council is not only about strikes. 

"I am positive that we will get to a point where they sit around a table and say, 'it is not to the benefit of both parties - it is not for the benefit of the employees, not for the benefit of the employers because they are going to lose production and they are going to lose income," said Tom Mkhwanazi, Secretary General of the Motor Industry Bargaining Council.

The perception is that in general, strikes are mostly politically motivated and not necessarily through the will of the employees, but as local elections loom in the country, Mkhwanazi disagrees with this notion.

"That has got no impact, the issues employees are looking at are their stomachs, they are not necessarily looking at political issues," he said.

MIBCO started negotiations about a week ago with two sessions but so far have had no real achievements as yet.

The General Secretary said the first two started on June 13th and 14th with the next two approaching towards the end of the month on June 28th and 29th.

"We have not gotten anywhere yet but parties are engaging among themselves to find each other because that is how negotiations go."

Mkhwanazi expanded on the role of MIBCO, which is to provide a platform for all 21 139 employers and 300 582 employees to negotiate.

The MIBCO represents everyone who deals with everything before a car is manufactured, the parts in essence as well as after the car is sold.

"A bargaining council deals with creating that platform for both employers and unions to come together and negotiate and conclude agreements - our agreements are extended by the minister (of Labour and Publication to apply to non-parties)."

One of the demands by Numsa is for a mega bargaining council, however the Retail Motor Industry Organisation (RMI) is against this.

"This demand/need by Numsa is not a new one, it was presented in the last negotiation in 2013, this time Numsa is asking for the components manufacturers to be moved out and put together with the automotive manufacturers to be shifted,” he said.

“They are also asking for the oil refineries and distributors to be moved from the sector where they are because we have got the fuel retail sector in our agreement, to be moved to MIBCO," he adds.

Employers do not agree with this as the majority of them are small and a “blanket” negotiation would not address the needs of everybody, especially while grouped with bigger corporations.

"I think it is understanding that you can’t have a one size fits all kind of an approach into collective bargaining - I think the system is not necessarily there," he uses a broken down car as an analogy to explain; how when changes are taking place in the car but as the driver, you are not willing to change with it, that as long as the car keeps moving, the driver will keep going with it.

As a result of this "one size fits all" pre-existing issue with the bargaining model, Mkhwanzi thinks it needs to be "refined"-"You have to, at a certain point in time, fix certain things", hence the research programme by MIBCO to look into it.

"As a result we have got a research project which we are busy with, which we are being assisted by the International Labour Organisation to look at our bargaining model, to make sure that it takes care of this diversity that exists”, which will hopefully be finalised by the end of the year.

Because negotiations for all motor industry parties happen around the same time, if a strike was to occur, Mkhwanzi says it could possibly be back-to-back protests.

The concern at this point is the international reputation of the motor industry which could be in jeopardy if the bargaining this year results in strikes like those experienced in 2013 and previous years, where nine weeks of protest ended in a loss of production of 58 000 vehicles worth a total of about 11.6 billion rand.


Demands by Numsa include a one-year agreement, in the hopes that the realignment of some of the components would be revisited over that time. The employer must contribute 80 per cent towards Medical aid and the employee contributes the remainder. Numsa also wants a 5 000 rand housing subsidy and the presented 20 per cent wage increase.

"I think the issue is that the economic situation from where I am sitting is such that all of us have to think really carefully before we go into a strike and I trust that the parties are definitely looking at the economic situation that we are finding ourselves."