adminThe number of locally assembled cars being sold in the country fell from more than 3 000 in 2003 to around 400 last year. “The number is still going down and projections show that by mid next year, no locally assembled car will be on the market. While I don’t want to raise alarm, it basically means there will be no Willowvale or Quest to talk about,” Engineer Dawson Mareya, the managing director of WMMI, told our sister paper, the Sunday News.
Such stark warnings being sounded by our local car industry should be taken seriously and authorities need to move quickly to protect the local industry and save jobs. Already employment levels in the sector have gone down from more than 20 000 in the late 1990s to below 2 000 at the moment. Capacity utilisation is just around 10 percent and this increases unit costs.
The local vehicle market is being dominated by cheap imports mainly from Japan, Singapore and the United Kingdom. Vehicle sales at WMMI have been depressed with information gathered revealing that for instance in March it recorded zero sales on Mazda T35, Mazda 2.2 Double Cab and HR DC types. Only eight Mazda 3 vehicles were bought that month while the highest sales were of Mazda 2.2 Single Cab where 32 units were sold.
The demise of the local car industry will have dire consequences not only for the vehicle sector but also for downstream industries which feed off it. For instance, engineering firms which manufacture car parts such as Deven, Loxton products and Bosal will suffer heavily from the death of the car industry. Reports also indicate other companies have been directly or indirectly affected by the depressed state of the vehicle industry and have either shut down or scaled down their operations.
Others have retrenched their employees. Government has in the past tried to move in and protect the local car industry by banning the importation of cars older than five years but after a nationwide outcry, reversed its decision. That decision last year opened the floodgates for cheap imports and the ports of Durban and Walvis Bay in Namibia have been working overtime to process vehicles destined for Zimbabwe. Traffic levels, especially in the capital, Harare, have increased dramatically over the past five years to the extent that there are jams every peak hour.
The traffic jungle in Harare is a sign of a nation whose vehicle numbers has sharply gone up. Government needs to move swiftly to limit the number of imported cars while capacitating the local industry. It can also increase duty on imported cars. Currently Zimbabwe levies duty of 25-40 percent for passenger vehicles and 20-40 percent for light commercial vehicles.
Countries such as China and Malaysia have pegged their duties at 100 and 300 percent respectively to deter imports from other countries and as a way of boosting the local industry. South Africa has banned certain second-hand cars from being sold in the country. Zimbabwe can protect its industry by banning the import of certain makes of cars that are found locally.
We feel tough decisions need to be made to safeguard jobs because the demise of the local car industry has far reaching ramifications for the economy of the country.
Online Reporter