Ford's retrenchment plans spark fears of broader job losses in SA's automotive sector

Banele Ginidza

The spectre of job losses looms over South Africa as Ford Motor Company of Southern Africa (FMCSA) has announced plans to retrench nearly 500 workers across its manufacturing operations in Gqeberha and Silverton.

This comes as Ford gave notice to retrench more than 500 workers as it streamlines its manufacturing operations at both the Struandale Engine Plant and the Silverton Assembly Plant.

Ford has proposed to realign its manufacturing operation in both the Silverton Manufacturing Plant (SVO) and the Struandale Engine Plant (SEP) to correspond with existing and projected manufacturing requirements in both plants.

This drastic move has ignited concerns among organised labour groups, prompting urgent calls for a comprehensive industrialisation policy to tackle the escalating unemployment crisis.

The National Union of Metalworkers of South Africa (Numsa) on Monday condemned the impending layoffs, characterising them as an assault on the working class.

According to Numsa, Ford’s realignment is projected to culminate in the discontinuation of approximately 474 positions, including 391 operator roles in Silverton, 73 operator positions in Gqeberha, along with 10 administrative roles and 141 fixed-term contracts that would cease by December.

"We have repeatedly stated that we urgently need more manufacturing and industrialization to create the most needed jobs in order to reverse deindustrialization that has taken place for the past three decades of our democracy, and stimulate economic growth in the economy," said Irvin Jim, Numsa's general secretary.

"And surely these retrenchments are worsening the levels of de-industrialization that have already taken place."

Jim said if South Africa were to succeed in dealing with the scourge of poverty, unemployment and inequality and all the related social ills including the high crime rate, then the State had no choice but to drive manufacturing and build infrastructure.

"The State must take drastic measures to ensure it strengthens its industrial policy and it must use its power not to allow companies that are beneficiaries of its incentives, to retrench workers at a whim," Jim said.

The official unemployment rate in South Africa increased by 0.3 of a percentage point from 32.9% in the first quarter to 33.2% in the second quarter, with manufacturing being one of the sectors that recorded a decline in employment.  

Dudu Nxele, Ford SA spokesperson, on Monday confirmed that FMCSA was making necessary adjustments to its manufacturing operations at both the Struandale Engine Plant and the Silverton Assembly Plant.

Nxele said these changes were part of the group's ongoing efforts to optimise production and respond to evolving market demands.

"We regret that these essential plant adjustments will result in a reduction of positions across both facilities. We understand the impact this has on our valued employees, and we are committed to supporting those affected. As part of this process, we will be offering voluntary separation options," Nxele

She also affirmed that Ford was committed to transparent and respectful engagement with its employees and was currently consulting with representative unions through the required consultative processes regarding these proposed changes.

However, trade union Solidarity said it saw Ford's announcement as possibly the beginning of greater job losses facing the entire automotive industry in South Africa.

According to Willie Venter, Solidarity's deputy general secretary, said economic pressures, international political uncertainties, and the government’s unfavourable policies may cause the industry to lose its competitive edge.

“When an automotive giant like Ford takes such drastic steps, it is a warning to the entire industry. We fear that further retrenchments in this industry may be inevitable if conditions do not improve quickly,” Venter said.

Solidarity has committed to attending the consultation process under the supervision of the Commission for Conciliation, Mediation and Arbitration (CCMA) and assured its members affected by the retrenchments that they will receive full support during this challenging time.

Meanwhile, Numsa insisted it has witnessed a disturbing pattern: that employers, when faced with declining profits, first target what they view as the weakest link in the chain—their workers. 

"Numsa calls on Ford Motor Company and the CCMA to set up dates for us to engage in consultation with the union, taking into account that we have a mere 60 days to find alternatives on a decision, which they took months to consider. We will engage Ford Motor Company and advance alternatives to retrenchments," Jim said.

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