Pex Foundry to close – recent strike in metal industry was last straw

Management at the Pex Group have decided to close the foundry division of the company as of 15 December 2021. The announcement of the closure is a blow to the Western Cape foundry industry and those manufacturing companies in the area that require castings as there are very few foundries still operating in the Western Cape.

Speaking to Sean White of the Pex Group, he said: “The continuation of the foundry business has been under review for some time as it has been a drain on the group’s resources for many different reasons. Although the foundry was established to supply castings to its sister company Pex Hydraulics, it changed focus and evolved into a jobbing foundry with the majority of its output being supplied to external clients.”

“Like many company owners in the steel sector of South Africa the recent National Union of Metal Workers of South Africa (Numsa) organised strike in the industry has put immense pressure on our business and forced us to make decisions that will ultimately have a detrimental effect on the workers in the industry.”

“For us the strike was a culmination of a number of factors and the proverbial last straw and accelerated our decision to close the company and the foundry. Being organised so soon after the COVID-19 period and just when companies were starting to make some headway, infuriated many and for some of us it was untenable to continue.”

“Our problems started some years back and they were mainly labour related. I won’t elaborate suffice to say that productivity and efficiencies are key words. A foundry is very labour intensive and if you can’t get these aspects right, whether it is in a foundry or any other business, then it is going to be a drain on resources.”

“The COVID-19 pandemic has brought about many changes in the workplace and its effect on the economy has been widespread and detrimental. Additionally, the COVID-19 pandemic has escalated the employment related financial risk to organisations as employers have to keep up with the changing demands of labour law. This pandemic has caused a lot of panic in the workplace with employers under increased pressure to act and make decisions on unprecedented matters. The resultant outcome is that the pandemic has shed light on both the financial fragility of many small businesses and the significant impact COVID-19 has had on these businesses.”

“We have also had to cope with Eskom’s loadshedding and on top of this the cost of raw materials has rocketed in recent months.”

“The last straw came when the latest strike action in the steel and related industries was called for by Numsa. It has left many business owners exasperated, angry, frustrated and looking for alternative manufacturing options and in our case closure. We were just recovering after the COVID-19 pandemic lockdowns and restrictions and then we had to face strike action.”

“We said no more and issued notice to our 32 employees that we will close the company on 15 December 2021.”

“We have remained open because we have a number of loyal clients, unrelated to our hydraulic business, and we did not want to let them down. But this last strike action has pushed us too far.”

Pex Foundry, based in Killarney Gardens, Western Cape was established in 1990 to produce hydraulic pump components for its sister company Pex Hydraulics. The foundry changed its mix of castings and customers over 20 years ago and became less reliant on the sister company.

Pex Foundry was a jobbing foundry, also equipped with two continuous mixers for production runs. The foundry had a fully equipped pattern shop to design and manufacture any pattern to customer requirements. Pex Foundry produced grey iron, SG iron, chrome iron, steel, bronze and aluminium castings for the railway, marine, commercial, agriculture and general engineering industries.

Interested parties have been talking to the shareholders but there has been no firm offer presented yet.