R70m boost for Formex
Metal manufacturing taking on new staff, increasing production capacity
Port Elizabeth-based metal manufacturing company Formex Industries will be injecting R70m into its business operations within the upcoming financial period, to increase production capacity.
The company, which consists of more than 550 employees, is also expecting to increase its workforce by 80 within the next month.
Formex Industries CEO Hennie Venter said the investment formed part of the company’s strategy to further align with the South African Automotive Masterplan (SAAM) 2035.
The major objectives outlined in the SAAM are to prepare the country by 2035 to produce 1% of the global vehicle manufacturing output, to include 60% local parts in vehicles manufactured in SA, and to double the number of employees in the automotive industry.
The company, located in Markman, will plug the investment into new equipment, to satisfy the wider range of customer demands within the automotive sector.
Formex Industries forms part of the Hosken Consolidated Investments Group and currently supplies metal products to automotive giants including Volkswagen South Africa, Ford Motor Company and Mercedes-Benz.
Venter said the R70m investment signified the intent and drive by Formex to retain its position as an industry leader.
“What we are seeing at the moment, especially with regard to how the national government is driving expansion within the automotive industry, is that there is certainly an increase in demand within South Africa.
“The new presses will allow us to satisfy this wider range of demand.
“We are looking at getting 80 new permanent employees within the next month and this all relates to work that will be there for at least seven years,” Venter said.
He said most of the employees were being recruited from Nelson Mandela Bay, with a handful being recruited from East London.
A core component of the company’s competitive advantage stemmed from it being close to 80% black owned and 40% black female owned.
“Many of the big automotive sector companies don’t yet meet the BBEEE requirements as stipulated in the SAAM.
“But by them sourcing from a company like us, they are able to score preferential procurement points and improve their rating,” Venter said.
Automotive Industry Development Centre EC board chair Weza Moss said he welcomed the investment.
“We have seen a slight decline within the global automotive and manufacturing sectors.
“So in contrast to what is happening globally, an investment of this nature is welcomed, Moss said.
“We hope that this will trigger even more investment.
“We hope Formex will use the opportunity and the R70m investment, as a tier-one supplier, to deepen the value chain within the automotive sector.”
“It’s important that Formex continues to find ways to achieve the SAAM 2035 objectives, but this initiative is appreciated and welcomed and shows confidence in our region,” he said...