Volkswagen Group Africa chair and MD Martina Biene says the group has taken a deliberate decision not to automate certain areas of its functions, even in instances where the car manufacturer is in the position to deploy robots, as a means of preserving jobs in SA.
“We could have already automated much more than we have done. If you look at our German plant and our plant [in SA], there is much more manual labour. It was a deliberate decision to do so [to protect jobs],” Biene told motoring expert Marius Roberts in an interview hosted by Investec.
“Of course, it must remain a business case. Labour costs are good in SA. We also want to play it [automating processes] responsibly,” Biene said.
“I don’t see AI replacing manufacturing anytime soon. We are embracing AI. It does a lot of good things.”
The group, which has had a presence in SA since 1946, employs about 4,000 people in SA.
Last year, Volkswagen announced it would build a small SUV as a third model at the Kariega plant alongside the Polo and Polo Vivo, in a R4bn investment.
The group’s Polo brand is popular in both the domestic and export markets. The Polo was SA’s most exported vehicle in 2024 and accounted for 88% of exported vehicles through the port of Gqeberha.
The group’s Polo vehicles are built at the Kariega plant in the Eastern Cape and exported to the EU and Asia Pacific markets.
Biene said it was not always easy to direct investments to SA. “When I pitch an [investment] idea, my biggest competition is not the other eight manufacturers in SA. The biggest competition is, first of all, internally, with 110 other Volkswagen plants around the world, and they all have ideas on where the group should invest,” Biene said.
“[The challenge] is to tell the group why they should come and spend money here in SA … the competition landscape has grown. We now compete with cars coming from India and China and it sometimes feels like the huge advantage from the past is not there anymore.”
Harry Kellan, CEO of FNB, whose clients make up about 60% of WesBank’s loan book, said Chinese car brands were entering the market rapidly, offering advanced technologies, electric and hybrid options and competitive pricing.
WesBank has partnered with several of these brands through multiple supplier and dealer alliance agreements, which bolstered advances growth.
Biene said she was not in favour of tariff wars, saying this was a race to the bottom approach. Rather, she said the government needed to acknowledge the role and investments made by local manufacturers and incentivise the industry accordingly to remain invested in the country.
“We employ 4,000 people directly and if you consider our suppliers, that’s another 50,000. So sometimes [the focus from the government] is all on new investments. I sometimes feel running a business with 4,000 people and suppliers employing 50,000 is not valued,” Biene said.
“In the last 11 years, we have invested R13.4bn in SA. We often get the question, ‘how many jobs have you created?’ and our answer is sometimes almost zero. The focus is to keep the jobs we have in a very difficult business environment,” she said.
“We are not saying this to protect us from imports, but [rather to] acknowledge the things local manufacturers are doing.”
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