(Adds union quote, inflation, details)
CAPE TOWN, Sept 9 Car makers in South Africa
signed a new three-year wage deal with militant union Numsa on
Friday, industry officials said, easing concerns of a labour
dispute in a key export and manufacturing industry.
South Africa's local motor industry, the largest in the
continent with hubs in the capital Pretoria and Port Elizabeth,
contributes 7.5 percent to GDP and around a third of the
manufacturing output in Africa's most industrialised country.
The deal allays fears of labour unrest potentially affecting
car makers such as Ford, Volkswagen and
Mercedes Benz SA. The sector produced 616,000
vehicles last year, about 0.7 percent of global output.
Mike Whitfield, president of the auto industry body,
National Association of Automobile Manufacturers of SA
(NAAMSA)and managing director of the Nissan Group of Africa said
in a statement that "the new wage agreement gives us a platform
on which we can plan further investment in the sector."
Industry and union sources had told Reuters on Thursday that
the new deal will see workers get a 10 percent raise in 2016 and
an 8 percent increase in each of the following two years.
"We got an offer which we are taking to our structures and I
can say it's a substantial offer. There is a good possibility it
will be accepted," Irvin Jim, Numsa secretary general, told
Reuters on Friday.
According to NAAMSA, investment by South Africa's seven
major car manufacturers has amounted to over 24 billion rand
over the last five years. Toyota announced plans in May
for a $390 million factory expansion project.
Negotiations over a separate wage dispute between Numsa and
the auto component sector are still going on.
The central bank and Treasury have warned that above
inflation settlements could have a knock-on effect, hurting
consumers already struggling in an economy expected to grow less
than 1 percent this year. Inflation is running at 6 percent.
(Reporting by Wendell Roelf; Editing by James Macharia)