BUSINESS MAVERICK

Less jittery Toyota is back in business in Durban after authorities provide a ‘recovery roadmap’

By Ed Stoddard 19 July 2021

(Photo: Dhiraj Singh/Bloomberg via Getty Images)

The Toyota Motor Corporation says its Durban factory will reopen on Tuesday, 20 July, just more than a week after it shut as rioting and looting spread across the city. It has been engaging with the city and the province, and raised concerns in a letter last week, but says local authorities have provided it with a ‘recovery roadmap’, assuaging its jitters.

Ed Stoddard

Reopening the plant, which produces the Hilux bakkie, the Fortuner, the Quantum and the Corolla Quest, is a reassuring sign that the eThekwini Municipality is returning to normal – or what passes for “normal” in South Africa these days. 

“Toyota Motor Corporation (TMC) issued a letter requesting an action plan from local government on Thursday morning, 15 July 2021. Since then [Toyota South Africa Motors] has received a positive response from the city and the province in the form of a recovery roadmap. This has gone a long way to assuage the fears of our parent company TMC,” the company said in a brief statement. 

The precise details of the roadmap have not been revealed. But Toyota’s Prospecton factory outside Durban is a key employer in the region, with a workforce of 7,200, many of whom would have several dependants whose numbers have probably swelled owing to job losses linked to the orgy of destruction. So one would assume that the local government would have been at pains to reassure the company about the security situation and related issues. 

The letter, a copy of which has been obtained by Business Maverick, said: “A key priority for Toyota is the safety and welfare of our employees, their families and the communities within which we operate.”  

It went on to say that the “incidents have left us feeling very uncertain about the future of our business in KZN”. 

Clynton Yon, senior manager for corporate communications at Toyota South Africa, told Business Maverick in an emailed response to queries that “our focus as a concerned corporate citizen is to ensure that local government has a definite plan of action to protect jobs and investment”. 

The factory’s resumption of operations signals that it has some confidence in the local government’s commitments on this front. Given the epic failure of the state in recent days, some observers may see this faith as naive or misplaced. But regardless, the factory is rebooting and 7,200 people are returning to their jobs.

In the letter, Toyota said it expected its local sales to fall by as much as 10% in July because of the N3 closure which had prevented it from delivering vehicles to customers in Gauteng. The new vehicle sales data for July, which will come out in early August, will show the full extent of the damage. 

And the Toyota plant there has big plans. These include the soon-to-be-launched Corolla Cross, a medium-sized crossover that will be the company’s first local production of a hybrid model. It is also working on a new replacement model for the Hilux. Such plans will almost certainly depend on the unrest not flaring up again.

The Hilux, of course, is famed for its toughness, a reputation immortalised in a classic Top Gear episode in which one was put through a series of stress tests which included placing it atop a building that was imploded. Foreign investors, as a rule, are not as durable. When things get really rough, they cut and run. The Toyota plant outside Durban is reopening this week. Next time, its employees may not be so fortunate. DM/BM

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All Comments 5

  • The only way to get this socialist obsessed government to listen to sense is for the multinationals to move to Botswana or some other business – friendly Country.

    • The ANC government’s public rhetoric is dated socialist stereotyping, but their actions are driven by extractive capitalism and the fantasy of the ‘free’ market.

  • What local and central government probably don’t grasp is that Toyota employs 7,200 people DIRECTLY. However, hundreds of businesses exist due to Toyota’s presence in Durban, and collectively, these employ far more people than Toyota. The closure of Toyota would have a significant economic impact on the region.

  • It seems the probably never-to-be-solved murder of the CEO of Rio Tinto and the closure of the mine has already slipped our minds and that of the “authorities”. How quick we forget that on the business front, taxi violence, burning of trucks and murder of drivers, truck hijacking, etc has been going on for decades. And it’s growing. The riots and looting is merely a growing realisation that the likelihood of getting away with most forms of criminal activity in this country is exceptionally high. As a result, criminals are growing bolder by the day.

    Of course, let’s spare a thought for the innocent people being murdered on a daily basis along with rape and other violence, amongst the highest in the world. Yet the government expresses no shame and continues to bury its head in the sand on that front.

    And then of course, government seems to have no answer for the ongoing rampant theft and corruption either.

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