South African cabinet regrets U.S. auto maker's phase-out move

Source: Xinhua| 2017-05-25 23:10:27|Editor: yan
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CAPE TOWN, May 25 (Xinhua) -- The South African cabinet said on Thursday it regrets the decision by General Motors South Africa (GMSA) to phase out the manufacturing and sale of Chevrolet vehicles in the country.

The cabinet has noted with regret the decision by GMSA, cabinet spokesperson Phumla Williams said after a fortnightly cabinet meeting in Cape Town.

GMSA announced last Thursday that it was pulling out of South Africa and selling its plant in the country to Japanese commercial vehicle company Isuzu.

The U.S. company, which has been in South Africa since 1926, said its decision had nothing to do with the recent downgrade of South Africa's sovereign credit to junk status by rating agencies Standard & Poor's and Fitch but as part of a worldwide reorganization to focus on more profitable businesses.

This decision "holds dire consequences for those who will lose their job and for our economy," Williams said.

The South African Department of Trade and Industry continues to work with all stakeholders to mitigate the impact, she said.

To increase manufacturing, employment creation and export intensity, the government recently launched the ninth phase of the Industrial Policy Action Plan (IPAP) to guide future actions, said Williams.

She said the cabinet notes that Isuzu, which has been partnering with GMSA over the years in South Africa, will take over the operations from GMSA.

GMSA said its phase-out will only affect about 600 workers.

But the National Union of Metal Workers of South Africa (NUMSA) said job losses will run into thousands, particularly in the area of Port Elizabeth where the GM plant is located.

NUMSA has urged the government to intervene as GMSA did not follow due procedures.

The union said it will not allow GM to further disadvantage workers.

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