Track: Operations Management

Abstract

In today’s world of global market competitiveness, the automotive industry component manufacturing sector, are not left out in the race for relevance and survival.  These categories are classified as tier 1, tier 2 and tier 3 suppliers based on certain criteria, and they form part of the automotive value chain.  The South African tier 2 automotive suppliers have not been competitive and the level of interventions within this industry space has been insignificant. Tier 1 suppliers currently prefer importing their supplies rather than local having to depend on local tier 2 supplies. With the fast changing trend in technology, benchmarking automotive components industry performance on national scale is crucial for global relevance and a secured future. The paper seeks to share findings on competitiveness assessment, carried out on the tier 2 automotive component suppliers in South Africa. In this study, a  systematic diagnosis of the tier 2 and lower tiers which ideally, are meant to produce the large mass of components required by the local automotive manufacturers was performed and  results indicate that there are gaps in areas such as employee engagement, continues improvement initiatives, research, development investment and energy efficiency. Addressing this issue will enable companies to be competitive nationally and globally.