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They said they would do it - and they've done it. We're talking about Renault's promise made last year that they would open a CKD plant in South Africa to cement even further Renault's long-term commitment to this market. Patrick O'Leary was at the opening.

There are some events in life one refers to as 'defining moments'. For Renault Trucks in South Africa, that moment came not when the company relaunched itself last year under the banner of the Imperial Group, but rather when the President and CEO of the company - on his first visit from France to South Africa - pulled back a small black curtain to unveil a brass plaque on a factory building in Apex, South Africa. The words on the plaque read: "The Renault Trucks Assembly line was officially opened by Stefano Chmielewski, President and CEO of Renault Trucks on Friday 31 March 2006."
 

The opening of this truck assembly plant by the big man himself - initially to assembly the Kerax range of trucks - symbolises much more than just a new development for Renault in South Africa. Rather, it acts as a solid statement that the company has found its home in Commercial Vehicle Holdings - part of the Imperial Group - and is here to stay, for good.
 

As our readers will know, FleetWatch has been critical of the various approaches taken by Renault in the past. But that is the past and we are going to leave it there. As Chmielewski stated at the press conference:

"I've had the opportunity to see some articles in the past which have not been flattering in terms of our market performance and strategies. However, we have identified South Africa - and this region - as one of the strategic places where we want to be. There will be difficult times but we will not repeat our mistakes of the past. We have a strategy which has the approval of our group. We have a good partnership in the Imperial Group and the market offers good opportunity for growth. We will stay." And that's it.

Establishing a CKD plant in South Africa has many benefits. For one, the world-wide demand for Renault Trucks has increased significantly in recent years as indicated by the overseas order book being full through to September this year. This has put pressure on their ability to supply Completely Built Up (CBU) units within reasonable lead times. 
 

Adding Renault Trucks to the other brands assembled improves efficiencies through improved utilisation of infrastructure. Here a Kerax cab snuggles up to an International. You’ll also see DAF cabs around.

The sourcing of kits improves availability and assures a stable pipeline which enhances planning and delivery. It also provides flexibility to retain models using pre-Euro III and Euro IV technology for longer to suit our local market requirements. This latter point is important for us in South Africa given that during 2006 and 2007, the entire Renault truck range will be changed to facilitate the introduction of Euro IV in Europe.

Secondly, import duty for CBU vehicles is avoided which gives Renault Trucks the opportunity to achieve one of the main objectives of the Motor Industry Development Programme (MIDP), namely, to make the cost of capital equipment as affordable as possible.

On this point, Pieter Fourie, CEO of Commercial Vehicle Holdings, says that up to now, the company itself has absorbed the cost of the import duties imposed on the CBU units so as not to burden customers with this additional cost. Customers should not therefore expect prices to drop now that the CKD plant is up and running. The saving that accrues will revert to the company which up to now has, in effect, subsidised the CBU imports for the benefit of its customers. Nice touch!
 

Another benefit of going CKD is the fact that the addition of Renault Trucks to the other brands assembled at Imperial's Apex plant (DAF and International), improves the efficiencies of the assembly facility through improved utilisation of the existing infrastructure.
 

Rodney Keyser, national sales manager of Renault Trucks (right) with a delighted Bobby Williams of JR Transport who received the first two of an order for 55 Kerax trucks at the opening of the CKD plant.

Last - but certainly not least - is that the investment in plant and equipment indicates a serious commitment by Renault Trucks to the South African transport industry to provide world-class products as well as reassurance of its long term approach. That's the one we think is so vitally important at this stage of Renault's growth in this region.

It all sounds pretty sensible and - well easy. Behind the scenes, however, a tremendous amount of work has gone into ensuring the success of this plant with the process starting shortly after the distribution agreement was announced between Renault Trucks and Imperial.

Renault Trucks in France has worked tirelessly with a local team under the leadership of Alnick van Zyl to ensure that local customers will be getting world-class products that take second place to none in terms of quality. That's what customers want - and Renault Trucks is ensuring that's what they'll get.

FleetWatch congratulates all involved in this venture. It really is good news for everyone.
 

The pictures left and below show various scenes on the new CKD line - the end result of a joint effort between Renault France and the local assembly team to implement systems and processes which will provide customers with trucks that meet and even exceed the quality standards applicable to vehicles produced in France. It’s a plant South Africa can be proud of.