NATIONAL COUNCIL OF PROVINCES
FOR WRITTEN REPLY
QUESTION NO 141
Mr R A Lees (DA-KZN) to ask the Minister of Trade and Industry:
1) Whether he or his department has considered the inclusion of a
mechanism to provide flexibility in respect of the minimum number
of units of production required of a production plant in order for
that plant to qualify for the incentives of the Automotive
Production and Development Programme; if not, why not; if so, (a)
when will this mechanism be included in the APDP, (b) when will it
come into effect and (c) what are the further relevant details;
2) whether the South African motor manufacturers approached his
department to request such a mechanism; if so, when was such an
approach made;
3) whether his department responded to such a request; if not, why
not; if so, what was the response to the motor manufacturers?
CW219E
REPLY:
1) Over the past few months, the Department of Trade and Industry has
been engaged in intensive discussions with the industry around the
finalisation of the Automotive Investment Allowance (AIS)
guidelines as part of the Automotive Production and Development
Programme (APDP). This is in the context of our strategic objective
of raising annual vehicle production to 1.2 million units by 2020.
In a meeting held on 29 October 2009 to finalise the AIS
guidelines, the following matters were agreed with respect to
minimum volumes.
⢠The minimum volume required to qualify for the APDP and AIS
will commence at 50,000 and be raised at regular intervals
between 2013 and 2020 in order to increase economies of scale
to meet the target of 1.2 million units per annum by 2020.
⢠That a provision will be made for circumstances where there
is a temporary and unforeseeable drop below the minimum
threshold.
2) There has been no formal request by South African motor
manufacturers for such a mechanism of flexibility.
3) Hence there has been no formal response by the department on this
matter.