Volkswagen’s Kariega plant, a key contributor to the Eastern Cape’s automotive industry, faces uncertainty amid policy delays. Picture Credit: Carmag
By Aisha Zardad
South Africa — Concerns are mounting over the future of Volkswagen’s Kariega plant in the Eastern Cape, with lawmakers and industry leaders warning that delays in government decision-making could put thousands of jobs at risk and further strain South Africa’s fragile economy.
Sonja Boshoff, Chairperson of Parliament’s Select Committee on Economic Development and Trade, said the country cannot afford additional industrial decline or factory closures. She highlighted the potential closure of the Kariega facility as a serious threat to employment and regional economic stability.
“The report that the Volkswagen Kariega plant in the Eastern Cape faces closure if the Government does not urgently implement critical industrial policy is alarming,” she said. “The President must act.”
Boshoff’s statement followed direct communication from Martina Biene, chairwoman of Volkswagen Group Africa, who wrote to President Cyril Ramaphosa, urging him to take immediate steps to safeguard the automotive sector. Volkswagen has indicated that uncertainty around policy decisions has put the Kariega plant at a critical crossroads.
The Kariega facility has historically been a cornerstone of the Eastern Cape’s manufacturing economy, providing thousands of jobs and contributing to regional exports. Boshoff warned that without rapid policy clarity, investment confidence, supplier networks, and workers’ livelihoods are at risk.
“We do not need to get on such a drastic and slippery road. Our economy is too delicate and stagnant,” she added.
Boshoff called on President Cyril Ramaphosa and Minister of Trade, Industry and Competition Parks Tau to engage with Volkswagen and other industry stakeholders immediately. She stressed that timely implementation of industrial policy is crucial to prevent further factory closures and job losses.
South Africa’s automotive sector is facing broader pressures. Earlier this year, Chery announced it would take over Nissan’s Rosslyn plant in Pretoria, ending local Navara production.
“Through this agreement, we’re able to secure employment for the majority of our workforce, thereby also preserving opportunities for our supplier network,” said Jordi Vila, president of Nissan Africa.
The move has drawn criticism from the National Union of Metalworkers of South Africa (Numsa). Irvin Jim, Numsa general secretary, said the country’s manufacturing capacity is under strain and called for a coordinated government response.
Other automakers, such as Mercedes-Benz South Africa, have faced challenges from policy uncertainty and tariff pressures, forcing consideration of scaling back local operations.
Boshoff concluded by urging urgent government action, emphasizing that the country’s manufacturing sector — and the livelihoods of thousands of employees — could be at stake.
