Toyota South Africa Motors (TSAM) sees a ‘silver lining’ after being forced to cease operations at its Prospecton Plant when flooding caused extensive damage to the facility a month ago.
The company is likely to lose around 45 000 units in production but has been encour- aged by a series of small gains in its recovery process.
According to Andrew Kirby, President and CEO of TSAM, the organisation is implementing a careful and systematic phased plan to return the facility to working condition. TSAM is pleased to announce that it has resumed operations of its export line of Catalytic Convertors and will – in the next few days – open the Hino assembly line.
Kirby says TSAM acknowledges that “this has been a tremendous setback for the company, but we have extensive insurance coverage. We are also fortunate that our parent company Toyota Motor Corporation (TMC) is supporting with all the cash flow challenges that we are likely to encounter.”
He said it will, however, take some time for the main lines – such as Hilux, Fortuner, Hiace and Corolla Cross as well as Corolla Quest – to reopen.
TSAM have made it clear that all the vehicles that incurred damage from the plant will be scrapped and crushed so that no potentially compromised Toyotas will ever make it into the retail chain.
The facility’s flood-protection measures were effective up to a point and will be reinstated and enhanced even further. TSAM is also working closely with the City of eThekwini to address some of the infrastructural shortfalls in the area to prevent a reoccurrence of a similar disaster in the future.
From a human resource perspective, the safety and welfare of TSAM employees remains a key priority. Management have confirmed that no TSAM employees will lose their jobs, and they will receive support from the company throughout the process.
It is not all bad news
It is a well-known fact that in most countries the transport industry and the countries GDP are closely linked. The local transport industry has shown tremendous growth during the first quarter with the Ctrack Transport and Freight Index (Ctrack TFI), which tracks all sectors of the transport industry, increasing by 13% year on year. This will in all likeliness mean that the 1st quarter GDP number will be robust, which should help the country’s growth in 2022.
Transport numbers locally give a real indication of the economic activity and it is expected that during 2022 we can expect growth of between 2,5 and 3%. With the transport industry as measured by the Ctrack Transport and Freight Index reporting good growth for the first quarter of 2022 the South African economy could have a better than expected year. This does however hinge on the effects of the recent floods in coastal areas as well as further price increases, which could hurt consumer and business confidence.
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