Massive investments will be needed by the automotive component supply industry in South Africa if they are to remain competitive in the face of growing global competition.

Joe Armstrong, chairman of the Catalytic Converter Interest Group, recently said more than R2-billion in additional investment will need to be made available for the local catalytic converter industry would to remain globally relevant. Also, new technology would be required to manufacture the next generation of converters for the diesel truck market.

Armstrong's findings were based on estimates from NGK in Cape Town and Corning in Port Elizabeth, both of which produce ceramic supports for coated diesel particulate filters.

Catalytic converters are a major source of valuable export credits for South African vehicle manufacturers and importers.

Fleetguard Emission Solutions, which is part of Cummins, recently opened an after-treatment exhaust manufacturing facility near Pretoria, following an investment of almost R20-million. Initially all production will be exported to Europe.

An investment of R118-million over the past four years has accelerated output at Smiths Plastics, in Durban, by 600 per cent and boosted jobs from 118 to 625. This comes as JSE-listed automotive component supplier, Metair, prepares for future growth - it is expected to invest a further R45-million in Smiths Plastics by 2007. Originally a subsidiary of Smiths Manufacturing producing air conditioner cases, Smiths Plastics has increased its product range considerably to include interior and exterior trim components.

Toyota accounts for 50 per cent of Smiths Plastics' output, while Ford, with 20 per cent, is the other major customer.

Another area of potential growth in South Africa is in the tooling sector of the industry. There is increasing demand for tooling to make components for vehicle manufacturers and other local industries, with a total tooling bill estimated at R4,2-billion. Only 20 per cent of the total tooling used in South Africa is sourced from local suppliers and the automotive industry is responsible for more than 50 per cent of local demand. However, this equates to only R420-million for local automotive tooling industry, with the remainder of the tooling, worth about R1,68-billion, being imported from countries such as Portugal, Germany, and Japan.

This percentage is expected to increase in the near future with strong support from the National Tooling Initiative, which was initiated by the CSIR and Automotive Industry Development Centre (AIDC) in 2002.