The East London Industrial Development Zone (ELIDZ) and the Automotive Industry Development Centre (AIDC), a subsidiary of the Gauteng Growth Development Agency (GGDA) signed a Memorandum of Understanding (MOU), marking the start of a strategic partnership.

This collaboration aims to bolster industrial growth and enhance the sustainability and competitiveness of the local manufacturing sector. The primary aim of this MOU is to establish a collaborative relationship that will see Small, Medium, and Micro Enterprises (SMMEs) receiving essential support and relevant skills in the automotive manufacturing space. It is important to note that this MOU does not create an exclusive relationship between the parties, allowing both ELIDZ and AIDC to embark on similar partnerships with other entities.

This strategic relationship is set to provide and co-package SMME incubation support, which is vital for establishing strong and sustainable black industrialists in the Eastern Cape region. By nurturing and developing 1 st, 2nd and 3rd tier automotive suppliers, the partnership seeks to deepen the value chain for localisation. Both parties are committed to optimising the business operations through interventions such as business process re-engineering, supply chain and logistics management, operational efficiency improvements, productivity enhancement, pricing strategies, sales and channel effectiveness, and capital expenditure planning.

These measures aim to create a more efficient and competitive business environment, benefiting both the enterprises directly involved and the broader economy of the Eastern Cape region. Additionally, the partnership will engage in joint research studies focusing on the productivity of ELIDZ’s targeted sectors. There will also be a concerted effort towards skills development and capacity building, including the training of productivity champions.

Identifying a facility for the establishment of a township automotive hub will be a key focus area. This hub is expected to play a pivotal role in bringing industrial growth to underserved communities. Furthermore, we aim to extend our efforts to automotive after-market value chain such as panel-beating, mechanical repairs, and upholstery. AIDC will bring its expertise to the partnership by collaborating on the development and establishment of an automotive learning centre at the ELIDZ, potentially in collaboration with the Mercedes-Benz Academy.

The conceptualisation and establishment of automotive hubs in townships, utilising available factory space, will be another crucial aspect of AIDC’s commitment. AIDC will also support the accelerator model for SMMEs within the ELIDZ, setting up mini factories and pairing SMMEs with tier-one suppliers to foster growth and development.

Exploration of additional areas of collaboration related to SMME opportunities within the automotive sector value chain will further strengthen the partnership. ELIDZ Chief Executive Officer (CEO), Thembela Zweni expressed optimism about the partnership: “This MOU marks a significant step towards strengthening our industrial base, promoting sustainability and economic growth in the region. We are confident that our collaboration with AIDC will bring about meaningful changes and opportunities for local businesses and communities.” AIDC CEO, Andile Africa echoed the same sentiments: “We are excited to join forces with the ELIDZ in this strategic endeavour. Together, we will work towards a brighter future for the automotive and manufacturing sectors in South Africa, driving innovation and fostering transformation in the sector.”

The signing ceremony took place at the ELIDZ Head Office in East London, marking the commencement of a partnership poised to foster a thriving ecosystem of black industrialists, automotive suppliers, and driving sustainable growth and localisation.