This comes days after the company’s global CEO Thomas Schäfer said he was “very worried” about the viability of the South African manufacturing operation, given the increasing cost of mitigating load shedding disruptions as well as port delays and rising labour costs.

However, during a year-end function on Monday that was attended by local media, VWSA boss Biene reiterated that although the issues raised by Schäfer are of huge concern, the company currently had no plans to leave South Africa.

In fact, Biene said the local operation was planning to increase production of its Polo to a record volume of 163 000 units in 2024.

To ensure this is possible without disruption, the company was planning to spend around R130 million over the next two years on renting generators and fuelling them with diesel. In recent times the company has also resorted to air freighting some car parts due to the port delays.

From the middle of next year, the local plant in Kariega, Eastern Cape, will become the sole producer of Polo hatchbacks for the European market. This will happen as the Pamplona plant in Spain is discontinuing the Polo to make room for the new ID.2 electric hatchback.

However, in line with the relaxed Euro 7 regulations, the current Polo won’t be sold in Europe beyond 2028 and is also set to be discontinued in other markets by 2029 with no word on a possible replacement.

This, it would seem, is where the danger lies for the local Kariega plant.

“We’re not a charity” – Volkswagen boss casts doubt on future of SA plant
Volkswagen international brand boss Thomas Schäfer’s recent words during a visit to the country are nothing short of chilling.

Schafer mentioned how the Kariega plant was once ranked among the world’s most competitive in terms of cost, reported Reuters. However in recent years the costs of overcoming disruptions caused by load shedding, as well as crippling port delays and rising labour costs have put the country in a somewhat less favourable position.

“Eventually you have to say, why are we building cars in a less competitive factory somewhere far away from the real market where the consumption is?” Schäfer said.

“I’m very worried about it … We’re not in the business of charity.”