The automotive industry needs to resume operations immediately
I have been rather quiet the past few weeks while I wrap my head around what is happening in our world at this moment. It is both overwhelming and terrifying, to say the least. I know that everyone is suffering in some way, may it be financially or mentally. I am extremely fortunate and privileged, yet I find myself in both these camps. As the money dries up so the anxiety levels increase. It is the unknown that really sparks the fear. And as the Covid-19 pandemic bulldozes its way across our world, so we must stand together and find ways to come out of it on the other side, relatively unscathed.
LEVEL 4 LOCKDOWN
As we head in to level 4 of lockdown, I know that every industry can reason as to why it needs to be operating. I don’t know the ins and outs of other industries, but I do know the automotive world. And I know why it needs to be operational. And so this is a piece I wouldn’t usually write, but I feel that as an automotive journalist, I have a duty in trying to save the jobs of so many which in turn will have a huge impact on our economy…and yes, probably my own pocket too.
AUTOMOTIVE INDUSTRY IN NUMBERS
Did you know that the automotive industry contributes 6.9% to the overall GDP of this country? To put that in to something I can understand, in 2018, the automotive revenue in South Africa amounted to R503 billion. At present, there are approximately 1 600 franchise dealers in South Africa, employing 60 000 people directly. Taking the multiplier effect into account, this number increases to nearly one million people in the full automotive industry value chain.
NAAMSA CEO, Mike Mabasa, estimates 21%-30% of SMEs could go out of business if the national lockdown extends into May, and up to 20% of industry jobs lost. Vehicle and components manufacturers currently employ about 120 000 people.
Do you see why it is so important that this industry start operating again, if just from an economic point of view?
But there are more reasons than this. Mark Dommisse, national chairperson of the National Automobile Dealers’ Association (NADA), says, “In order for the economy to function efficiently, it relies on various forms of crucial mobility services, including the repair and maintenance of private and public transport, parts availability, and new vehicle supply. The motor industry plays a critical role in getting people, products and services to market. It is therefore imperative that dealerships be among the first businesses to commence work when lockdown restrictions are eased.”
As the GM of Marketing for Kia Motors South Africa, Christo Valentyn puts it, the reasons for servicing and maintenance to resume as a matter of urgency are plentiful. A car is usually a person’s second most valuable asset. It requires maintenance to protect its value and manufacturer’s warranty. While almost every manufacturer has measures in place to protect warranties, it does not change the fact that vehicles need services and maintenance despite not travelling many miles.
- Brakes can rust and bind to discs, causing discs to warp when used after long periods of not being used. Calliper pins can corrode, making brake performance less than required.
- Sometimes the interior electricals tend to develop a fault (electric windows get jammed, electric seats stop working)
- Cars that are not used over a long period may develop ineffective cooling from the air-conditioner and will need to be recharged.
- Most of the fluids, like engine oil and brake fluid, break down and lose their ability to lubricate.
- Even if you disconnect the batter, it cannot retain all the “juice” inside forever and it will eventually drain.
- With so many engines made from aluminium, they need constant lubrication as, after a period of standing, it will cause engine scoring and, in some cases, warpage.
- Gear boxes are mild and cast steel (as well as brass) and also need constant lubrication, as it can cause synchro failure, which in turn causes gear failure.
According to TransUnion Auto Information Solutions the automotive industry will take a year or more to recover from the Covid-19 pandemic. But like Dommisse says, it is a sector of the economy that can contribute enormous benefit in the immediate-term, a factor that needs to be seriously considered by government.
“We are a highly vulnerable industry. Motor retail is right on the edge but, if it is saved, and can open quickly, we can bring in revenue both for dealership staff and to the fiscus, which is a win-win for all.”
I can only hope that our government considers all the factors when deciding on whether this industry can resume operations during level 4 lockdown. As I mentioned at the beginning of this article, I know that there are many industries that will want to start operating as soon as possible, but if the automotive industry can pave the way in the meantime, then I am all for it!
PS. I miss driving!