WARNING: This is Version 1 of my old archive, so Photos will NOT work and many links will NOT work. But you can find articles by searching on the Titles. There is a lot of information in this archive. Use the SEARCH BAR at the top right. Prior to December 2012; I was a pro-Christian type of Conservative. I was unaware of the mass of Jewish lies in history, especially the lies regarding WW2 and Hitler. So in here you will find pro-Jewish and pro-Israel material. I was definitely WRONG about the Boeremag and Janusz Walus. They were for real.
Original Post Date: 2010-04-06 Time: 13:00:01 Posted By: News Poster
Harare – Willowvale Mazda Motor Industries is once again facing a crisis, and is pressing as hard as it can to have the duty on imported pick-up trucks increased to give it some protection from competition.
The assembler is operating at under 20 percent capacity in a market where cash is short and where, and here we must be honest, most buyers of new pick-up trucks prefer other makes.
A modest reduction in duty is unlikely to improve demand significantly for Mazda pick-ups.
When duty on imported trucks was twice what it is now, demand was still low.
In any case, we doubt whether it is possible to increase duty on Sadc-made trucks without running foul of at least the spirit of the treaties we have signed, or wish to sign, and without facing retaliation on the sort of things we export.
Even if it is possible, any increase in duty can only be very short-term as Sadc moves towards a free-trade area. When that is achieved, and some very tight deadlines have been set, duties will sink to zero for Sadc-made vehicles.
So WMMI needs to rethink its whole assembly and sales philosophy.
The firm has always had some degree of protection. The factory was built by Ford of Britain to assemble Fords for Central Africa. UDI put paid to that and after the factory was closed for a short while, it was taken over by the Industrial Development Corporation and relaunched as a contract assembler.
This meant that it assembled kits for the registered dealers of any make of vehicle. This suited the company.
Other people imported the kits, putting up the capital or raising loans or obtaining credit. Willowvale assembled the vehicles, and did quite a bit of import substitution, and charged an assembly fee. It did not require a lot of capital.
Over the years. the IDC gradually acquired many of the dealerships and in effect there was a more seamless operation. But Willowvale still assembled a wide range of vehicles.
Then came the Mazda deal. Mazda took up a minority of the equity with WMMI and promised some technology transfer. In return WMMI became an exclusive Mazda assembler.
For the whole period of UDI, the initial independence era, and the Mazda buy-in, WMMI had a captive market. It was, in fact, almost impossible to import fully built-up vehicles.
When markets were liberalised, WMMI hit troubles. Anyone with foreign currency could buy what they wanted and did so. And it is at that point of liberalisation, rather than any recent duty changes, that WMMI ceased to be a vital profitable company.
It was largely kept afloat for the next decade or so by filling many orders for the State and for State-owned companies, all of whom were asked to use locally-assembled vehicles as far as possible. Now even that semi-captive market is no more.
We believe that WMMI has three options.
If it wishes to retain the Mazda connection then it must, in effect, become a subsidiary of Ford South Africa, who make and market most Mazdas in this part of the world, and be integrated into Ford’s Sadc manufacturing system.
If that is not possible, or desirable, then the firm must look at returning to full contract assembly, making others put up the capital and supplying the kits.
Or, as a final option, it must sever the Mazda connection and seek a connection with another Sadc manufacturer.
We believe that it is quite possible for WMMI to be integrated as a final assembler into almost any Southern African manufacturer’s production system even if duties on imports from Sadc sunk to zero.
Assembly is the most labour intensive part of any vehicle manufacture, and Zimbabwe can offer workforces that are potentially more skilled than those in South Africa and willing to accept lower wages than in South Africa.
Even as wages start leveling out across the region, Zimbabwe’s jump-start in the 1980s on universal secondary education gives it a strong edge in almost any technological industry.
In other words, it should be possible for Ford-Mazda, or any of the other major manufacturers if that company is unwilling, to cut margins and boost profits by doing some final assembly in Zimbabwe rather than South Africa.
What is not possible is a return to captive Zimbabwean markets. The movement towards free trade in Southern and East Africa is irreversible.
WMMI should be thinking about how it can fit into this future free-trade area rather than trying to live in some past golden age when it actually put buyers on waiting lists.
In the interim, Zimbabwe could look at reducing duty on kits for assembly in Zimbabwe, rather than retain the present duty and increase that for built-up vehicles. Why should consumers suffer because WMMI lacks imagination?
But this breathing space would only be effective if WMMI and its majority shareholder, the IDC, started rethinking how a profitable assembly plant can operate in a free-trade zone that includes South Africa. Otherwise it will be just another wasted opportunity.
Original Source: 
Published by the government of Zimbabwe
Original date published: 9 March 2010
Source: http://allafrica.com/stories/201003100203.html?viewall=1