Stellantis revises Peugeot Landtrek bakkie plant plans in response to evolving market trends

Despite the bleak economic outlook, trade wars, and general gloom currently gripping South Africa, Stellantis is forging ahead with its plans to build a plant in the Coega region.

Locally, the Stellantis portfolio includes Citroen, Fiat, Jeep, Alfa Romeo, Opel, Peugeot, Leapmotors and Abarth.

Speaking at a Stellantis Media Connect event in Johannesburg, Managing Director of Stellantis South Africa and Sub-Saharan Africa, Mike Whitfield, said the plans have changed slightly, but the earthworks have been completed.

Plans changed

“Our original plans have changed slightly as we adapt to the incredible disruption that we're not only seeing in the global market, but the local market as well.

“Previously, the plan was to produce 50 000 Peugeot Landtrek bakkies per year for export into Africa and the Middle East.

“But as we've all seen, the dynamics of the pickup sector have changed significantly, with many new one-ton players entering the local space.”

Whitfield pointed to the disruption in the market, especially from Chinese manufacturers.

“Only 34% of vehicles made in this country are sold here.

“We are obviously aware of the big challenge coming from vehicles that are made in India and China, and, indeed, the Chinese share of the market has grown significantly from 0.7% in 2018 to 12.9%.

"These are not things you can ignore, and you need to adapt and address that as you go forward."

From the original plan of producing only the Landtrek one-ton bakkies, they have now included two more production lines.

“One will be a new energy vehicle, and one I can't say anything about at the moment, but the Landtrek will remain the core product in the factory.”

Local and Africa

Whitfield confirmed that the products produced in Kouga will be for local consumption and export into Africa.

“I think that ultimately, most automotive manufacturers still see Africa as the last frontier left.

“But as you are aware, the African Continental Free Trade Agreement is gaining momentum. Hopefully, at the Council of Ministers meeting in September, in Egypt, we can get adoption of the rules of origin and full adoption of automotive policies in the first quarter of next year.

“So, along with that will come the ability to create free inter-African trade, but also the start of addressing things like common standards and certain levels of used vehicles.”

Asked whether the plant was still a viable proposition, Whitfield said: “Stellantis has one of the biggest investments of any automotive manufacturer in Africa and the Middle East. 

“We have plants that we own directly in Algeria, Egypt, Morocco, Tunisia and Turkey, and we're the only manufacturer who has a direct equity investment in sub-Saharan Africa, where we have a plant in Nigeria.

“Our 2030 strategy is to become the most localised player in the region, so it's logical to be in South Africa going forward.”

Stellantis aims to make an announcement on which additional products will be built at its plant towards the end of this quarter.