South African Autos Strike Set to Intensify as Workers March

South African carworkers are demanding a double-digit wage increase for three years and will intensify a two-week-long strike if their demands aren’t met, the National Union of Metalworkers of South Africa said.

Numsa last met employers to discuss wage increases for its members on Aug. 29, national treasurer Mphumzi Maqungo said in an interview at a protest march today in Pretoria, the capital. The union wants to restart negotiations and resolve the strike, he said. “We are hoping that employers come back with a better offer before” Sept. 5., he said.

About 30,000 workers at plants owned by companies including Toyota Motor Corp., Volkswagen AG, and Ford Motor Co. have been on strike since Aug. 19, costing the industry as much as 700 million rand ($68.2 million) a day, according to the National Association of Automobile Manufacturers of South Africa. At least 500 workers marched toward the Naamsa headquarters in Pretoria, carrying signs bearing slogans such as “equal pay” and singing songs demanding better wages.

About 90,000 construction workers have also downed tools and gold miners are due to walk out later today as wage negotiations deadlock across Africa’s biggest economy. Work stoppages have already shaved 30 basis points, or 0.3 percentage point, off gross domestic product this year, President Jacob Zuma said on June 13.

Various Benefits

Numsa wants a wage increase of at least 10 percent for three years as well as various benefits including better medical aid and shift flexibility, the union said in a letter of demands handed to reporters. Employers have agreed to 13 of 24 requests and are continuing to talk to labor representatives, according to Automobile Manufacturers Organization Chairman Thapelo Molapo.

“I don’t see the strike continuing beyond this week,” Molapo said in an interview.

Employers proposed an offer that included a 10 percent annual pay rise for three years that was rejected last month, Numsa’s Maqungo said by phone on Aug 26. The union has asked the companies for improvements, Numsa Secretary General Irvin Jim said on Aug. 30. The proposal compares with South African inflation of 6.3 percent in July, the first time it had exceeded the central bank’s 3 percent to 6 percent target range in 15 months.

Bonus Same

“It’s unfair,” said Mawatle Moeng, 54, who was taking part in the Numsa march. “My yearly bonus has been the same since 1999.” Moeng works at the BMW plant adding seatbelts to cars that sell for 350,000 rand, he said. “They can’t even give us a 14 percent increase.”

Companies and workers must find a solution to strikes that are “not helpful” to the country, Zuma told reporters in Pretoria today. South Africa has been plagued by labor action for more than a year, hurting economic growth and weakening the rand, which is down 18 percent against the dollar this year, the worst performer of 16 major currencies tracked by Bloomberg. The rand weakened 0.3 percent to 10.3182 per dollar by 4:11 p.m. in Johannesburg.

South African car exports were down 23 percent in August due to the industry strike, Naamsa Executive Manager Norman Lamprecht said in an interview. Vehicle sales in the country dropped 0.3 percent unexpectedly in August, the first decline since March, Naamsa said yesterday.

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