Similarities and differences between the South African and the Australian car industries

PROJECT TWO: PORT ELIZABETH
The next month, you and another senior consultant must accompany a client to South Africa in a “due
diligence” project. The client is the VP International of a major British manufacturer of car parts with
production plants in many countries. The company is contemplating increasing its presence in South Africa
after the Chinese car manufacturer BAIC decided to open a new multi-million car assembly plant in Port
Elizabeth (https://www.youtube.com/watch?v=XJ-6hYCOEbg). However, there were long delays in the
completion of the BAIC project and now your client is having doubts about investing more in this country.
Therefore, they have commissioned a report about the long-term prospects of the South African car industry.
The visit to the Coega Special Economic Zone was interesting but, as expected, everyone you encountered
seems highly optimistic about the future. You call Lukas back in Edinburgh and he suggests that you write a
1,000-word report that establishes any similarities and differences between the South African and the
Australian car industries, with a focus on the challenges to achieve economies of scale in such a competitive
sector. Employ as much data as you can find to prove your points. For the sake of the client, remember to
define all relevant theoretical concepts and explain how they apply to the companies you refer to.
Conclude your report by briefly describing a method to determine the efficiency of the South African car
industry in order to entice the client to commission another project.
Essential Reading:
“Start of production at BAIC plant delayed until later this year”
https://www.engineeringnews.co.za/article/start-of-production-at-baic-plant-delayed-until-later-thisyear-2019-02-26/rep_id:4136
“BAIC opens compact SUV plant in South Africa”
“Toyota to cease manufacturing cars in Australia” https://africaautomotivenews.com/2019/05/23/baic-opens-compact-suv-plant-in-south-africa/
http://www.theguardian.com/world/2014/feb/10/toyota-cease-manufacturing-cars-australia

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