S.African govt, car sector to discuss loan package

JOHANNESBURG, Feb 24 (Reuters) - South Africa's trade and
industry minister will meet car makers to discuss a rescue
package to help limit job losses, a government spokesperson said
on Tuesday.
About 22,500 jobs are on the line in the automotive and
component manufacturing sector, the National Association of
Automotive Manufacturers said earlier this month.
Car producers including Volkswagen , Mercedes-Benz
, Ford , Toyota <7203.T> and General Motors
employ about 116,000 in South Africa and are key for a
country where about a quarter of the labour force is jobless.
Car industry representatives said this month they were
looking for loans at low interest rates to help with cashflow.
Component manufacturers said they needed at least 10 billion
rand ($998.5 million) in loans.
"The meeting with the minister (Mandisi Mpahlwa) and the
automotive industry will take place this evening from around six
(1600 GMT)," said Lillian Mofokeng, Trade and Industry
spokesperson.
Economists have warned of severe job losses if carmakers and
component manufacturers do not secure loans from the government.
Dealership owners Bidvest , Barloworld and
Imperial will not be part of the rescue package
discussions between the carmakers and Trade Minister Mandisi
Mpahlwa.
VW has already said it would axe 400 jobs and Mercedes-Benz
said it could shed about 150 jobs as domestic car sales plummet
and a global economic downturn undermines demand for exports.
(Reporting by Phumza Macanda; Editing by Ruth Pitchford)
((phumza.macanda@thomsonreuters.com; +27 11 775 3152; Reuters
Messaging: phumza.macanda.reuters.com@reuters.net))
(For full Reuters Africa coverage and to have your say on the
top issues, visit: http://africa.reuters.com/)
($1=10.015 Rand)
Keywords: AUTOS SAFRICA/

Keywords: AUTOS SAFRICA/

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