Engineering in the Eastern Cape: A mixed bag of opportunities and challenges for 2015


Without a doubt, there are huge growth prospects for the engineering sector in the Eastern Cape – especially considering plans by government to spend billions on public infrastructure development across the province to address socio-economic challenges, as well as increasing private investments into hubs such as the Coega and East London IDZs.

In addition, the Eastern Cape accounts for over half of the vehicles exported from South Africa annually, creating numerous opportunities for small component suppliers as well as for other engineering services.

Several ‘big ticket’ investments such as the construction the province’s biggest shopping mall, the R1.7-billion Baywest Mall in Port Elizabeth, as well as the R12-billion Umzimvubu Water Project, in the Transkei, have ensured continued business for civil engineering firms.

Henning van Wyk (Gelvaspin)

“The state of the industry, in my opinion, is stable due to several projects active in the Eastern Cape that require hot dip galvanising or duplex coatings,” Henning van Wyk, Managing Director at Galvaspin, told Business Link magazine.

Port Elizabeth-based, Galvaspin provides high quality, cost-effective solutions for surface preparation and protective coating applications to the manufacturing industry.

Sean Steyn (Phicor)

Sean Steyn, Managing Director at Phicor, which offers turnkey solutions to the building industry from conceptualisation to the finished products on-site, says; “We are currently in a good position within the market and find ourselves blessed with ample work within various private and commercial sectors. I strongly believe this is due to the high quality of work that our factory produces with stringent quality control.”

“So far 2015 has shown very positive results with a full order book to date. The outlook for the year is exciting with the announcement of numerous automotive projects and opportunities on the horizon,” describes Mike Hubsch, the owner of Ex-Es Expert Engineering Solutions, a specialised tooling and equipment supplier to all industry sectors.

However, boom times also come with misfortunes as other industry players are seeing.

Babini Melitafa (MC Design)

“…the state of our industry is very competitive. A lot of small companies have entered the space which is driving prices lower and lower,” explains Babini Melitafa, Director of Business Development at MC Design and Contracting, which specialises in the facilitation of projects in various engineering fields.

Philip Noah (Ndodana )

Philip Noah, the Director at Ndodana Consulting Engineers, which designs civil engineering projects and administers contracts between clients and contractors, says; “At present it is difficult to obtain jobs due to lack of funding and competition amongst consultants. There is also a scarcity of technical expertise within the client bodies, which leads to an inability to manage the scope of work and give guidance for the implementation of major projects”.

As can be expected, the province’s engineering sector has not been spared from the continuing blackouts as Eskom struggles to meet demand for power in the national economy. While some have been fortunate to escape the blackouts others have had to seek other solutions to ensure their production lines continue moving.

“Fortunately, we have not been affected by load shedding in the industrial areas but if it should be implemented, it would have a crippling effect not just on the companies but also the staff and their families that work for us.  We have a large amount of molten metal on site and for obvious reasons we need to keep the metal molten 365 days a year,” explains Henning at Galvaspin.

Sean at Phicor also said they had not been directly affected at their premises by load shedding but they have to monitor the load shedding timetables carefully and ensure that their back-up generators are ready at all times.

Philip at Ndodana believes that; “Load shedding not only leads to delays but also affects the psyche of designers and planners because of start-stops creating loss of momentum in the progression of thought processes.”

Still other challenges have no immediate solutions. While presenting his 2015 Budget Speech in Februray, Finance Minister Nhlanhla Nene showed that things are set to become tough before they get better. The Minister increased taxes and levies while cutting down growth forecasts for the economy. This was also confirmed in a recent presentation by the Treasury in Port Elizabeth.

The National Energy Regulator of South Africa (NERSA) also approved a municipal electricity tariff guideline increase of 12.20% for the 2015/16 financial year – without a doubt; all this has an overall bearing on the fortunes of Eastern Cape engineering sector.

In the end, efforts by government to set the province on a path to prosperity and continuing huge investments in its major Special economic Zones, cities and towns will go a long way to sustain its engineering sector albeit with a demand on companies to continue innovating to meet new challenges while staying ahead of their competition.


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