HomeBusiness DigestQuest appeals for government support

Quest appeals for government support

TRAFFIC congestion on Zimbabwe’s metropolitan roads is fast approaching levels of Nigeria’s Lagos, Ghana’s Accra and Tanzania’s Dar es Salaam where workers spend as much as four hours on a 30km stretch to work during peak hours.

Taurai Mangudhla

More and more Zimbabweans are buying motor vehicles, but the expenditure and growing population of vehicles does not translate to local car manufacturing support as most of the cars are cheap second hand Japanese and UK imports.

The introduction of a 25% surtax on second hand vehicle imports effective January 2012 did not deter Zimbabweans from spending billions over the past four years to import cars whilst the country’s local assembly plants face collapse.

Zimbabwe’s oldest car assembly plant, Quest Motor Manufacturing (QMM), is clear testimony to challenges that have bedeviled the industry, with only 130 workers currently employed compared to 1500 at peak. During a tour of the plant last week, QMM Engineering manager Ezekiel Moyo said the plant was now running at under 5% capacity utilisation due to low uptake of its product.

“If we are to run eight hour shifts we employ 1500 employees but now we are at 130 and running at less than 5% capacity utilisation,” said Moyo.

He said QMM employees are currently helping a sister company to service vehicles because of the low uptake of their vehicles.

“At peak we can make 35 vehicles per day, but now we do three depending on the model because some models can take two days to complete a single unit,” Moyo added.

The QMM appealed for government support through purchase of its vehicles to move volumes, improve on efficiencies and help the company remain afloat.
“We would want support from government through purchase of vehicles, not capital injections because we want to sell,” he said.

“If we are not supported by government and if our government chooses to support South Africans then who will support us?”

Moyo said the company is assembling a wide range of vehicles that can be used by government employees for different purposes in their day-to-day work.
“We have a wide variety of vehicles depending on what the buyer wants,” he said.

The cheapest car is the Cherry QQ, a city car, which is being sold at US$12 000 and has fuel consumption of 5 litres per 100 km. The cherry QQ has proved popular with driving school companies and ordinary business for messengers.

Moyo said the cost of the Cherry QQ can go as low as US$9 000 if volumes grow. However this remains out of the reach of most Zimbabweans who are buying used cars in the same range such as the Toyota Vitz, Honda Fit and Nissan March for less than US$3 500 from Japan.

“We are currently working talking to banks for funding terms,” the Moyo said.

QMM is also assembling the 2011 Cherry Tigo compact sport utility vehicle (Suv) which is sold at US$26 000 for the manual transmission and US$31 000 for the automatic transmission.

The car competes with other compact Suv’s like the Honda CRV, Toyota Rav 4 and Hyundai Tucson.

QMM is also assembling ranges of the Foton Tunland two wheel and all wheel drive on single and double cab.

Moyo said the Tunland all wheel drive double cab trucks costs US$41 000, between 10 to 15 % less than its competitors — Isuzu, Toyota and Mazda Trucks.

The Tunland is built with American Cummins engines which are reputable for their performance and durability.

The company, Moyo said has just signed an agreement to start assembling Futon range of buses locally.

“We are currently importing them just for marketing purposes and we are saying we want support to start moving more volumes so that we start assembling them locally,” Moyo said.

The QMM asembly plant is situated in Mutare and has been operating since 1960. To date, it assembled over one hundred thousand vehicles of 170 different models including land Rover, Nissan and Peugeot.

Problems affecting QMM have seen other companies, which relied on the company such as United Spring and Forging, Dunlop Zimbabwe and Karina textiles catching a cold. Moyo said QMM creates 30 000 jobs through the multiplier effect when operating at capacity. Zimbabwe’s industry capacity utilisation stood at 39,6% in 2013 and is seen crumbling further due to persistent macro-economic challenges that have seen companies shut down and thousands of employees being laid off.

Confederation of Zimbabwe Industries president Charles Msipa in May said industry would celebrate if it manages to maintain the 39,6% average capacity utilisation in the CZI manufacturing sector survey results to be released between June and July as the operating environment remains tough.

He said infrastructure bottlenecks such as lack of adequate electricity and water supplies, lack of funding, reduced or low aggregate domestic demand have weighed down industry.

“If we can maintain 39% this year and if we can arrest decline in capacity utilisation, that will be quite an achievement, then we build on that,” Msipa said.

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