Category: Companies / October 4, 2012 3:24 PM EDT
Toyota Motor Corp said an illegal four-day strike at its South African manufacturing plant in Durban city is over and production is expected to resume on Friday (October 5).
An illegal pay strike had halted production at Toyota’s plant in Durban raising fears that South Africa's manufacturing sector may not be spared the wildcat stoppages sweeping its mines.
The Japanese car giant said it had settled the dispute on Thursday (October 4) and expected a return to work on Friday.
"In terms of the impact, it is a measure impact, we are running at current capacity. So, to catch back on that lost production we will have to work overtime and that will be discussed now with the our staff. And then one has to consider that we 58 export clients- 58 countries that export our vehicles to- and it is very important for both our image and for our agreements that we resolve and fill those orders as soon as possible,” said Leo Kok, Toyota spokesman.
The plant produces 120,000 units a year, with 50 percent of the cars destined for the export market and the rest sold in South Africa and neighboring states.
Labour analyst Loane Sharp says South Africa is losing credibility as an investment destination because of strikes.
"Well these strikes have a terribly disruptive effect on operations. Particularly for our automative manufactures who have very integrated supply chains, and they supply largely under export contracts to the rest of the world. These kinds of distribution put all of those contracts at risk, and certainly South Africa is becoming one of the less favoured nations in terms of employer and employee conflict," said Sharp, adding:
"So, companies who would otherwise be considering locating their operations in South Africawill now have second thoughts about doing so."
The stoppage at the plant piles more pressure on the leadership of President Jacob Zuma ahead of an internal leadership election in the ruling African National Congress (ANC).