Abstract
M.B.A.
The motor industry in South Africa, (SA), is experiencing a period of turmoil that will
result in its complete restructure.
The globalisation of the industry and the involvement of government with the Motor
Industry Development Programme, (MIDP), is forcing the development of strategies that
are formulated to equip the local manufacturers to become globally competitive.
The MIDP has had a major influence on the development of the industry since 1994, as
it has allowed the entrance of new competitors into SA due to the gradual reduction in
import tariffs. It also proposes to stimulate the export potential within the industry of
vehicles and components by offering a rebate structure with which the manufacturers
can offset import duty.
It will also force a consolidation of the industry in that amongst others there is more
co-operation between vehicle and component manufacturers. A financial consideration
of the MIDP is to reduce the industry's use of forex. The historical background of the industry in South Africa shows a rather proud and
colourful past, with most of the major players in the international motor industry having
been represented locally at one stage or another. With the disinvestment campaign that
preceded the new government, found a core of manufacturers remaining and competing
in a fairly 'flat' market. However that has all changed, and although there is no
immediate substantial market growth in sight, the influx of new competitors continues,
making the market complicated and competitive.
Audi itself has only been represented on the SA market from 1968, however as no
focused marketing strategy was developed for it, it never really was in the same league
as BMW and Mercedes Benz. In 1994 this all changed as VWSA decided to introduce
Audi onto the market competing in all premium market segments. What followed was a
focused marketing strategy, which required a separate dealer network and Audi specific
staff. The process of selecting dealers was based on market potential and also on the
established infrastructure. The new dealer network then started to undergo the process of conforming to the external corporate identity, CI, requirements, and this should be
completed by mid 2001.