Ford to invest $1.05 billion in South Africa to build updated Ranger
Ford Motor Co. on Tuesday said it would invest more than $1 billion in its South Africa operations to support expanded production of an updated version of its Ranger pickup truck, starting in 2022.
The investment tied to Ford's Silverton Assembly Plant, located just east of capital city Pretoria, marks the Blue Oval's largest to date in its nearly century-long history in South Africa. The investment is expected to increase the plant's capacity from 168,000 vehicles annually to 200,000, and will add 1,200 "incremental" jobs with Ford in South Africa, for a total workforce of 5,500 employees.
Ranger trucks built at Silverton supply the domestic market as well as more than 100 other markets globally — but not North America. Additionally, the South African plant will build Volkswagen pickup trucks as part of Ford's strategic alliance with the German automaker.
"This investment will further modernize our South African operations, helping them to play an even more important role in the turnaround and growth of our global automotive operations, as well as our strategic alliance with Volkswagen," Dianne Craig, president of Ford's international markets group, said in a statement.
"Ranger is one of our highest volume, most successful global vehicles," she said. "This investment will equip our team with the tools and facilities to deliver the best Ford Ranger ever, in higher numbers and with superior quality."
The automaker said in a news release that with the new investment, the Silverton plant is expected to generate revenues that represent more than 1.1% of South Africa's gross domestic product, which in 2019 totaled more than $350 billion according to the World Bank.
The investment includes $686 billion for upgrades to the Silverton plant aimed at growing production volume and improving efficiency and quality, the automaker said. Planned upgrades include a new body shop featuring robotic technology, and a "high-tech" stamping plant. Those facilities will for the first time be located on the plant's site.
Upgrades also are planned for the box line, paint shop and final assembly. Ford also will build new vehicle modification and training centers, and allocate $365 million to upgrade tooling at major supplier plant.
"The extensive upgrades and new state-of-the-art manufacturing technologies will drive efficiencies across our entire South Africa operation — from sequenced delivery of parts direct to the assembly line, to increased vehicle production line speeds and precision of assembly to ensure the world-class quality that our customers expect," Andrea Cavallaro, director of operations for Ford's international markets group, said in a statement.
The automaker also is in the process of building solar carports for 4,200 vehicles at the Silverton plant, as part of a larger renewable-energy project. The goal, said Cavallaro, is to take Silverton "completely off the grid, becoming entirely energy self-sufficient and carbon neutral" by 2024.
Global automakers and industry experts view Africa — given growing population, relatively low rates of vehicle ownership and prospects for economic growth across the region — as a promising market.
"Due to the rise of income levels in many African countries and the emergence of a middle class, Deloitte regards the continent as the final frontier for the global automotive industry," authors of a 2018 Deloitte report on Africa's automotive sector. "Given Africa’s population size and its positive economic outlook, automotive companies will be able to gain a competitive advantage by adopting a medium- to long-term view towards the continent.”