Costly to do business in SA says BMW

Doing business in South Africa is costly for BMW and its South African managing director Bodo Donauer says that the state of logistics infrastructure locally was creating problems for the company according to a report published by Business Live.

22 Aug 2011

Donauer says the company can build up to 87 000 vehicles a year but is not doing so as it faces stiff competition from Asian and European companies. Moreover, he says that utility costs, including electricity, had risen by 100%.

The company has managed to reduce electricity consumption by 30% in line with government guidelines but warned that the company is trying to find more and more ways of "taking costs out" of is business at all levels.

He warned that South African workers have "a long way to go" when it comes to efficiency, particularly compared with workers in Asian countries and says wage demands from unions were "far above inflation", creating challenges for BMW.

Read more: