ONE of Ford's top international executives visited Nelson Mandela Bay yesterday to check the progress on what he called "a new chapter" in the 90-year history of the company in South Africa.
Shanghai-based Dave Schoch was speaking after visiting the company engine plant at Struandale, on the edge of New Brighton. His particular focus was the progress being made in preparation for a breakthrough contract to export diesel engines made in the Bay to the US – a first for the local company.
"Ford Southern Africa competed for this contract with other plants throughout the world and proved it could be fully competitive on quality, cost and dependability of production," said Schoch, president of Ford Asia Pacific and Africa.
The plant is adding a further 31000 3.2-litre Duratorq five-cylinder (i5) turbodiesel engines to its production to cater for an export contract for the US. The first engine for the new export contract is scheduled to come off line at Struandale towards the end of the year.
The engine is to be used in the Transit van when it joins Ford's North American product line-up later this year. The Transit is Europe's best-selling commercial vehicle and is also set for introduction in South Africa. "For the first time, the South African operation is providing engines for the 'mother ship' of the company – Ford in the US," said Schoch, who was chief financial officer of Ford SA in the 1990s. "The local operation and the entire Asia Pacific and Africa division have put a huge amount of effort into securing the contract, which marks a new chapter in the history of Ford SA, which was established in Port Elizabeth in 1923.
"If all goes well with the Transit engine – and judging from the preplanning and what I have seen today at Struandale, it will – then it could be the beginning of bigger opportunities between the company in South Africa and the US."
Schoch said with the plant – which opened in 1965 – was already running at full capacity and with the new contract, its future was assured. Local production of the engine for the US in the first year would be more than 31000 units. The current production line – which already produces 75000 engines a year for new Ford Ranger pickups for the local and export markets and 220000 engine components packs – is being extended with the addition of 16 new high-tech machines.
Ford SA president Jeff Nemeth said the expansion of the plant for the Transit engine would not affect existing capacity. The plant is running 24 hours a dayon completed engines and 16 hours a day on machining components. The new engines will be exported through one of the city's harbours to Kansas City, US.
Nemeth said the proximity of the harbours had not been crucial to the new contract, but the fact that Ford had been exporting engines for more than a decade and had established sound and dependable relationships was an obvious positive factor. While significant, the increased Eskom tariffs were not a major concern as South Africa power costs remained competitive.