Hopes for end to South African auto strike

2nd October 2013, Comments 0 comments

South Africa's car manufacturers have made a new wage offer in a bid to end a strike that has crippled production for almost seven weeks, industry said Wednesday.

Automakers believe most production can restart this week after waves of component manufacturing workers went on strike, adding to earlier stoppages to drag down exports by 75 percent last month.

The Retail Motor Industry Organisation, which represents component producers, is offering a ten percent pay hike this year and eight percent annually the next two years, though some auto plants have refused the deal.

The current industrial action has affected seven plants of major car manufacturers including Volkswagen, Ford, Mercedes, Toyota, and General Motors in a sector which contributes six percent to the economy.

"The signs are reasonably positive," Nico Vermeulen, executive director of the National Association of Automobile Manufacturers of South Africa (Naamsa) told AFP.

"Hopefully by Friday or Monday the production will resume in the motor components industry," Vermeulen said after a meeting with workers, owners and the minister of transport.

The National Union of Metalworkers of South Africa (Numsa), the industry's dominant labour group, said it would put the increase to members Wednesday and was pushing for the deal to go through.

But there were objections to a "peace clause" that would forbid workers from downing tools in the next three years.

"We need to persuade our members to accept the offer, but the workers do not want the peace clause included in the agreement," said Numsa regional secretary Phumzile Nodongwe.

The 78,000 component labourers downed tools more than six weeks ago demanding higher pay, just as car construction workers ended their strike.

Manufacturers claim production has been slowed by 3,000 vehicles a day because of component shortages, with a cost of $60 million each day.

Meanwhile car exports dropped by three quarters in September compared to 2012-figures under the effects of the twin strikes.

Nedbank analysts said Wednesday the current stoppages would likely brake exports in coming months as well.

"Manufacturers can programme and plan to recover some of that lost production, overtime, Saturday work, but the problem is also the longer the strike goes on, the more difficult it becomes to recover," said Naamsa's Vermeulen.

The strikes follow stoppages in mining and construction as competing unions make increasingly radical demands.

© 2013 AFP

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