Name of the Project
Volkswagen Kariega manufacturing plant upgrade.

Location
Kariega, in the Eastern Cape, South Africa.

Project Owner/s
Automaker Volkswagen Group Africa (VWGA).

Project Description
Volkswagen announced an investment in its Kariega manufacturing plant in April 2024.

The investment is aimed at preparing the plant to manufacture a third model from 2027. The model, which will be a sports-utility vehicle (SUV), will be manufactured on the same production platform as the Polo and Polo Vivo – Volkswagen’s top-selling passenger car brands in South Africa.

Volkswagen Brazil led the design and development of the new SUV. However, VWGA’s engineering team collaborated with its Brazilian counterpart to adapt the new model to local and continental requirements such as the development of a right-hand-drive version.

It is highly likely that the South African equivalent of the Tera will be Volkswagen's most affordable SUV in the local market.

The bulk of the investment will be allocated towards production facilities, manufacturing tooling, local-content tooling and quality assurance. Nearly R877-million will be spent to enhance automation in the body shop and R418-million will be used to buy new press tooling for the press shop.

Potential Job Creation
Polo and Vivo have 46% and 58% local-content levels respectively. The trend is set to continue with the new model, which aims to achieve an estimated 40% local content through a R1.2-billion investment.

Capital Expenditure
VWGA has invested R4-billion into modifying its Kariega plant for the “A0 SUV entry” production, including R1.6-billion to localise content

Planned Start/End Date
Production is planned to start in 2027.

Latest Developments
VWGA has entered the commissioning phase for the production of the Tera.

The company advises that production has returned to normal after four weeks of upgrades to the existing plant to accommodate the new model’s production.

The plant halted production from April 14 to May 12 to complete required installations and upgrades to the body shop, paint shop and final assembly areas.

The majority of the upgrades were completed during a 25-day yearly plant shutdown period in December.

The commissioning phase of the third model production entails a systemic process of bringing the new equipment online and performing necessary checks to ensure these are functioning optimally. VWGA is undertaking this work predominantly over weekend periods to avoid disruption to the plant’s normal production in the week.

VWGA production director Ulrich Schwebe has said the new model will be just as iconic as the beloved Polo and Polo Vivo once it is introduced to the market.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
Volkswagen Group Africa head of group communications Andile Dlamini, tel +21 41 994 5042 or email andile.dlamini@vwsa.co.za.