At least 60 workers have been retrenched from Kariega auto-parts company Dana Spicer Axle, according to the National Union of Metalworkers of SA (Numsa).
There has been no confirmation of this figure from the company, but correspondence indicates the issue of retrenchment was tabled as far back as February.
The retrenchments come against the backdrop of escalating de-industrialisation in Nelson Mandela Bay, and a warning by the city’s business chamber of the “survival emergency” facing the city’s manufacturing sector.
Yesterday, a group of about 30 people, including workers still employed at the Dana factory and Numsa officials, gathered outside the company gates in Brickfields Road to strike in support of their retrenched colleagues.
Numsa shop steward Moagi Marumulo said the way the retrenchment had happened was unacceptable.
“Engagement on the issue was under way, but then this suddenly happened.
“The guys were already booked for their shift last week Monday, but when they arrived, they were told they were being retrenched.
“They had no representation, and they were misled into accepting that they had to sign a document.
“The company is likely going to use that now to seek to interdict this strike.
“About 63 members of the approximately 300 blue-collar workers at the company have been retrenched in this way.”
He said the union was not happy with the company’s argument that a dip of 19% in orders from Ford was the main reason for the retrenchment.
“The numbers do not add up.”
He said workers were not happy with the package that they had been offered.
“The company’s proposal includes two weeks’ payment per year for each year of service.
“Most of these guys have worked for the company for just 2-3 years.
“How can they pay off their car or house with that? How can they care for their families?”
He said the union was questioning the company’s rejection of the proposal that it should first consider offering the package to workers close to retirement.
“There are many who fall into that category, and they have indicated they are happy to go.”
Siyangaphi Haltile said he had been working at Dana as a quality technician for about two years.
“When I went in on Monday May 11, we got a call from HR. They just told me, this is your last day.
“It’s bad, because now I must sit at home. Where am I going to get a job? What will happen to my child?”
He said he was hoping that some good would come out of both further engagement and strike action.
“We must push for the best deal.”
Mzukisi Philip, one of the Dana workers participating in the strike, said the retrenchments had left him and his colleagues concerned and insecure.
“If they can do it once, they can do it to us next time. We are no longer sure of our future.”
A colleague, who asked not to be named, said the retrenchments had left the remaining workers overextended.
“Until now, I have been looking after one machine. Now I must look after two, yet I do not get extra pay.”
Marumulo said the union’s demands included a R200,000 lump sum gratuity to each retrenched worker plus four weeks’ pay for each year worked.
“We are also calling for a bonus to be awarded as if the worker had completed the year, and for all leave for 2026 to be paid out.”
He said strikers had not tried to coerce the workers who had not downed tools.
“This is a peaceful action.”
According to the Dana Spicer Axle website, SA’s only manufacturer of axles, the company supplies about 350,000 parts annually to Ford, Isuzu, Nissan and Toyota for their one-ton vehicles.
The plant employs more than 400 individuals, of which 90% reside in Kariega and Despatch and 10% in Gqeberha.
According to an April 13 letter to Numsa from management, signed by Dana Spicer Axle SA country manager Petri Badenhorst, there was no dispute on the reason for the retrenchment.
“The parties have reached consensus that the Ford Motor Company SA order book reduction of approximately 19% constitutes a genuine and sufficient reason for the restructuring of [Dana’s] operations.
“The 189a [retrenchment notice] further reflects a reduction in demand by all Dana’s customers.”
Badenhorst said the union’s proposed package was not acceptable in its current form.
“The company confirms that this letter does not constitute a closure of the consultation process.
“The parties remain engaged in a meaningful joint consensus-seeking process.”
Badenhorst noted in an April 17 letter that the company proposed as far back as February 25 a selection criterion for the 189(3) notice, the pending retrenchment.
However, she said, neither Numsa nor the other representative union, Uasa, had responded.
A Dana employee, who declined to be named, said senior management representatives were not available for comment.
He said the Nelson Mandela Bay Business Chamber chief executive officer, Denise van Huyssteen, should be contacted.
She said the local manufacturing sector “has been facing an economic survival emergency for some time.
“Nelson Mandela Bay has been disproportionately affected by de-industrialisation versus the rest of the country, as our manufacturing sector directly accounts for 22% of the metro’s GDP.
“It is responsible for employing over 40% of the people working in the country’s automotive sector.”
She said additionally, the knock-on impact of the industry on the surrounding economic ecosystem was significant.
This was because the metro’s direct and indirect economic activities were largely centred around the automotive industry.
“The chamber has recorded over 6,000 job losses in the metro’s manufacturing sector over the past 18 months, with most of this taking place in the automotive components sector, followed by pharmaceuticals and then general manufacturing.
“This is reflected in the official unemployment numbers for the metro, which currently stand at just under 30%, with most of the job losses recorded in the past few quarters taking place in the manufacturing sector.
“The hollowing out of the ecosystem surrounding automotive manufacturing is a major concern to us.
“Given this situation, we have for some time been actively advocating and lobbying for urgent action to be taken to retain much-needed investment and employment in the metro.”
She said the South African domestic market had not grown to the extent envisaged in the Automotive Master Plan, while localisation levels had declined to between 30-40% versus the target of 60%.
“At the same time, the fast-moving developments in the global, national and local environment have put local CKD [completely knocked down] manufacturing with its low economies of scale at risk.”
CKD manufacturing is a production strategy where a product is fully disassembled into individual components, shipped, and then reassembled in the destination country.
Van Huyssteen said one of the core reasons for the shrinking of the component manufacturing sector was the displacement of locally assembled vehicles in the market by cheaper imports from Asian markets.
These had increased to the extent that last year, 67% of vehicles sold in SA represented imports.
“Coupled with this, local manufacturers have been struggling with enabling environment issues such as high energy costs, unreliability of power supply, logistics inefficiencies and the lack of delivery of basic municipal services.”
She said recent reports of downsizing at manufacturers due to weakening demand in the automotive supply chain were concerning.
This was especially given the strategic importance of original equipment manufacturers and component manufacturers to the regional economy and employment levels.
“This reinforces the urgent need for the implementation of a co-ordinated industrial strategy that protects and strengthens local manufacturing capacity and incentivises localisation and exports.
“This strategy must at the same time safeguard jobs and improve the competitiveness of South African manufacturers.”
She said the automotive sector remained one of the Bay’s biggest economic drivers.
“Any contraction across assemblers, component manufacturers or supporting industries has far-reaching implications for employment, investment confidence and economic stability in the region.”
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