Localisation for Africa
SA Foundries pay significantly more for electricity and raw materials than BRIC counterparts.
foundry) with a demand pull( leveraging the unique requirements of customers) to upgrade the foundry value chain,” says Cunningham.
“ Customers want foundries that are good and getting better, they want foundries that have good internal measurement and control. They expect company-wide continuous improvement and ongoing investment in the foundry.
Many foundries can compete with European foundries on price and complexity, but cannot compete with Asian foundries on price and delivery speeds.
Manufacturers increasingly realise that they cannot be competitive if their supply chain does not give them an advantage. Thus they want flexibility and responsiveness, yet good prices so that they can enter new markets.
It cannot be denied- price matters, especially when entering new markets or reclaiming lost markets” concludes Cunningham.
Interestingly, Spada and Cunningham concur on the topic of foundries not being good communicators in general and the absolute need to shift from the attitude of“ I melt metals” to“ my foundry is a solution provider, focusing on the needs of the customer and delivering at the right price, quantity and quality”.
Customers of the foundry sector face similar challenges( energy, cost of labour, material and so forth), so if it is streamlined from the start through communication, then the supply chain benefits.
In an ideal world, this means that the customer and the foundry should work together to find the balance that improves the casting process. foundries pay significantly more for electricity and certain raw materials than its BRICS counter parts.
In addition, South Africa’ s labour cost in relation to productivity is cause for concern amongst foundries in the BRICS countries.
The BRICS Foundry Forum was jointly hosted by the NFTN and SAIF.
The National Foundry Technology Network( NFTN) is an initiative of the Dti and works closely with the South African Institute of Foundrymen( SAIF).
A study was commissioned by the National Foundry Technology Network( NFTN) to make meaningful comparisons between the various countries in relation to iron casting foundries. The results of the study indicate similar export patterns across all the BRICS countries, with most products destined for domestic markets.
The dominance of the automotive industry as a sector supplied by the foundry industry is not as pronounced in South Africa, where mining dominates.
When viewed as a percentage of production costs, labour costs in South Africa are the highest amongst BRICS countries( 33.5 %) followed closely by Brazil( 32 %). The other countries reported labour costs ranging between 8 % and 20 %.
Sharing insights at the BRICS Foundry Forum
Duncan Hope, Project Manager, CSIR MSM
Brad Harris- Director of Quality, Bremen Castings, USA
With the shift to localise, this means foundries need to step up and to develop along with their customers.
They need to really look for design improvement and design for better and or improved manufacturability. This will make it cheaper to manufacture after the casting process.
At the BRICS forum which preceded the MCC event, it became evident that South African
Adrie El-Mohamadi- Project Leader of the NFTN
Adrie El-Mohamadi, Project Leader of the NFTN, says that the study was commissioned to provide a snapshot of the iron foundry industry per country.“ Although the study looked at public sector support and incentives amongst BRICS countries, the issue is a complex one with many layers which needs further interrogation,” she says.
Dr Shephard Bhero, UJ
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