New South African auto industry strategy could have global impact

There are global implications for suppliers, vehicle assemblers and industry strategists in the current – largely secret – review being made of South Africa's Motor Industry Development Program (MIDP).

The government has confirmed that it will renew the MIDP, which was due to expire in 2012, in some form, but is expected to introduce a modified program to provide a similar level of support in a different format. Informed sources expect the new program will no longer put such emphasis on exports to a global market with massive overcapacity, but focus more on OEMs procuring components from South African sources. This could radically alter the situation in the local component industry.