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Supply chain partners collaborate to showcase catalytic converter industry at the 2017 NAACAM Show

MARCH 29, 2017
Supply chain partners collaborate to showcase catalytic converter industry at the 2017 NAACAM Show

South African based substrate suppliers, coaters, canners and associated industries, will jointly be showcasing the catalytic convertor industry supply chain at the 2017 National Association of Automotive Component and Allied Manufacturers of South Africa (NAACAM) Show to be held in conjunction with the National Localisation Indaba at the Durban ICC from 5-7 April.

The industry partners are collaborating for this exhibition in order to heighten the understanding of the impact of the catalytic convertor industry on the South African economy, as well as the importance of a well-designed package of state and customer support to ensure the long term sustainability and growth of its presence in the country.

In support of NAACAM’s transformation goals and initiatives in the automotive sector – and specifically the component manufacturing sector – the platform of this exhibition will also be used to showcase opportunities for black South African entrepreneurs.

Participating at the stand are: Substrate Supplier NGK; Coaters BASF, JMSA, Umicore; Cataler SA, Canners Benteler, Boysen, Tenneco, Eberspächer and Component Manufacturer Senior.

Background to the catalytic convertor industry

Reduction of auto emissions is a rapidly growing imperative around the globe, with policy framework being developed around sustainability decisions. As emissions regulations tighten around the world, projections are that the demand for autocatalysts, diesel and petrol particle filters will more than double over the upcoming two decades, while the “accessible” global passenger car market is estimated to grow by about 60% by 2022.

The catalytic converter industry is composed largely of global multinational manufacturers who supply to the OEMs from facilities strategically located internationally, including plants in South Africa. The South African production facilities were established at the request of the OEMs and commenced manufacture of catalytic converters in the early 1990s. In its over 25 years of existence in South Africa, the catalytic converter industry has achieved remarkable growth, averaging compound growth in the region of 14% per annum. The industry is the highest contributor to component export revenue and has the highest local content at over 85%.

The South African catalytic converter industry is a complex vertically-integrated supply chain comprising some more than 50 manufacturing plants. The industry remains one of the very few downstream manufacturing industries in which South Africa has a significant global footprint. The companies comprising this supply chain are the global leaders in their respective areas, and have invested in current state-of-the-art production facilities equivalent in both scale and technology to those in their overseas operations.

Autocatalyst production remains the largest global consumer of platinum group metals (PGMs), consuming some 8 million troy ounces per annum. South Africa alone beneficiated 15% of locally mined PGMs in the production of catalytic converters. The industry is also the largest consumer of locally produced stainless steel.

The industry is a substantial generator of highly skilled employment, with over 5 000 direct jobs (excluding OEMs and stainless steel manufacturers) and an estimated more than 30 000 indirect jobs resulting from upstream and side-stream suppliers. The industry places a high focus on skills transfer and development, with all companies providing high-tech training and education both locally and overseas. The industry has invested in excess of R5 billion in plant equipment, people development, and process development to support transfer of production and new technologies to South Africa. This has resulted in significant skills development in the support industries as well as within the catalytic converter industry.

The concept is amplified when one considers the role of companies in the autocatalyst value chain in driving production of other new and advanced manufacturing segments such as fuel cell related production. Thus maintaining the base already set by the autocatalytic manufacturers is crucial