Vehicle manufacturer Mahindra South Africa (SA) is celebrating the milestone of having the 20 000th locally assembled Pik Up “bakkie” rolling off the line, as the company prepares for its next phase of growth in the country and looks to initiate localisation.

The company this week hosted a site visit to its semi-knockdown (SKD) assembly plant, located in the Dube TradePort special economic zone, in KwaZulu-Natal, where the Pik Up cab units are assembled, to commemorate this milestone.

Mahindra SA logistics head Arnold Reddy told Engineering News this milestone encapsulated the plant’s growth since its inception in 2018, progressing from producing about 200 units a month, to now producing upwards of 700 units a month.

Moreover, the plant has evolved from initially only producing single-cab units, to now also producing double-cab units and special editions.

Mahindra SA CEO Rajesh Gupta attributed this progress to a focus on driving improved efficiency and skills development at the plant.

Mahindra has been present in South Africa since 2004. Reddy said that, over the years, the brand had grown organically – coming in and understanding the environment and market, progressing to different models and growing sales and ensuring that it could meet customer demand.

“We came in, tested, and saw the potential, and now we are growing. The brand is taking a new direction. We are launching various new models.”

This growth is encapsulated in the company’s planned sodturning, next month, on a new, bigger plant, which will also be located in the Dube TradePort.

Slated for completion next year, the new plant will have the capacity to produce nearly 1 300 units a month.

Reddy said the larger size of this plant would also allow the company to improve its stock building.

This new plant is being developed in partnership with Automotive Investment Holdings (AIH) Logistics, which provides independent contract assembly operations to Mahindra SA.

AIH Logistics would own the new facility, while the current facility was being leased, Reddy informed.

Reddy highlighted that Mahindra was looking to “re-energise” itself in the country, with the launch of new models. In October, it would be launching the 3XO model, which Reddy said was a “shifting point” for Mahindra in South Africa.

It will also be bringing in a refresher of the XUV700 model.

Moreover, Gupta said the group was exploring the opportunity to bring in the Global Pik Up model, which was showcased to the South African market in Cape Town in August last year.

He explained that the group was still assessing the level of integration of this model into the South African market, and, therefore, it would only likely be brought in by 2026.

Reddy highlighted that, with the upcoming launch of new models, the company was entering into its next phase of growth in the country.

“If you look at the way the market has shifted now, it’s about having the right product, with the right capabilities and the right dealer network,” he averred.

Mahindra SA is headquartered in Gauteng and boasts a dealer network of 90 dealers in the country.

The company also has its own training facility, providing technical, sales and marketing training for its dealer network.

LOCAL IMPACT
Mahindra SA strategic marketing head Nomonde Kweyi highlighted that as part of Mahindra Rise, it was important for the company to have a plant that contributed to the socioeconomic development of the country as well as its automotive landscape.

Mahindra Rise is a philosophy that encapsulates the essence of the Mahindra Group’s commitment to driving positive change across the globe.

In this vein, the assembly plant employs about 90 people, a combination of direct employment and outsourcing to service providers.

Reddy highlighted that all of the staff working specifically on line in the plant were sourced from the local community, and were previously unemployed. “We created employment, provided the right level of training and skills, and we keep supporting them with the development of their individual careers.”

The company is also looking to increase women representation on the line, as this part of the plant is currently male-dominated, Reddy said.

SKD production entails assembling imported, already assembled component subsets into a completed vehicle. The plant currently receives these subsets from Indian-headquartered Mahindra Group, and assembly takes place locally, to supply the local market and some Southern African Development Community countries.

As such, there is currently no local content in the components, and Mahindra is looking to change this, with the company seeking to start sourcing certain local components from October.

For example, it is seeking to locally source tyres for its vehicles, with this to then be removed from the exported subsets.

The group does not presently have a specific percentage target for local content. Rather, Gupta said, it would be going about localisation in a more frugal way – gradually introducing locally sourced components, where feasible, until the economies of scale were favourable for bigger components.

Therefore, the group is focusing firstly on increasing volumes, and then on localisation, Gupta averred.