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South African Carmakers Union to Decide on Strike Today

South Africa may face strikes involving as many as 335,000 workers after deadlocks in wage negotiations between employers and the country’s biggest unions spread to gas stations and car dealerships.

About 72,000 motor industry workers will walk out on Sept. 2 after a breakdown in wage talks between the National Union of Metalworkers of South Africa, the Fuel Retailers Association and Retail Motor Industry Organization, the union said in a statement today. They will join workers in the auto manufacturing, construction and aviation industries who are already on strike, while gold mining companies face the threat of labor action.

Numsa “has taken a conscious decision to exercise our hard fought democratic and constitutional right to embark on an indefinite strike action,” spokesman Castro Ngobese said in an e-mailed statement. “The strike action has not been on our agenda, but it has been imposed on us” after the motor industry didn’t meet its demands.

South Africa has been wracked by labor disputes for more than a year, hurting economic growth. Inflation reached 6.3 percent in July, the highest in 15 months, while the rand has weakened 18 percent against the dollar this year, the worst performer of 16 major currencies tracked by Bloomberg.

About 30,000 workers at plants operated by car manufacturers including Toyota Motor Corp. (7203), Bayerische Motoren Werke AG (BMW) and Volkswagen AG (VOW) have been on strike since Aug. 19, while 600 technical staff at state-owned South African Airways and 90,000 employees at building companies have also downed tools.

‘Remain Hopeful’

“From our statistics about 49 percent of canvassed companies employees didn’t turn up for work on Aug. 26,” Annemie Cowley, manager for communications and marketing at the South African Federation of Civil Engineering Contractors said in an e-mailed response to questions today. “We remain hopeful that the strike will not be of a long-term nature. About 90,000 workers are employed in the civil engineering contracting industry.”

Unions have rejected a 7.5 percent offer from the SAFCEC, which has about 400 employer members including Murray & Roberts Holdings Ltd. (MUR) and Aveng Ltd. (AEG), the country’s biggest builders, according to the Federation.

“We are in continuous dialogue with NUM and BCAWU and optimistic that an agreement can be reached through continued dialogue,” SAFCEC’s Cowley said.

The National Union of Mineworkers, which is associated with the ruling African National Congress, attended a meeting on gold wages yesterday. The union has reached a point of non-resolution with mining companies, according to its Secretary-General, Frans Baleni.

‘Right Balance’

A gold-mining strike would result in 142,000 people stopping work in an industry already impacted by a 15 percent decline in the price of the metal. The six-member FTSE/JSE Africa Gold Mining Index has fallen 37 percent this year compared with a 9.8 percent rise in the FTSE/JSE Africa All-Share Index.

“Strikes are not the end of the world,” Finance Minister Pravin Gordhan said at a mining conference in Johannesburg today. “Let the workers and the employers find the right balance. At the end of the day there must be enough cooperation to create normality in our environment.”

The strike at South African Airways has caused only minor disruption to flights, according to its spokesman Tlali Tlali. There have been four flight delays since yesterday, he said.

“The company is still hopeful that a speedy resolution to the current impasse can be found,” he said in an e-mailed statement.

To contact the reporters on this story: Kevin Crowley in Johannesburg at kcrowley1@bloomberg.net; Amogelang Mbatha in Johannesburg at ambatha@bloomberg.net; Kamlesh Bhuckory in Johannesburg at kbhuckory@bloomberg.net

To contact the editors responsible for this story: John Viljoen at jviljoen@bloomberg.net; Simon Thiel at sthiel1@bloomberg.net

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