Nelson Mandela Bay has emerged as the frontrunner to land a R2bn investment that could revive the metro’s manufacturing fortunes.
The city announced on Thursday that China’s Sailun Group had identified the Coega Special Economic Zone (SEZ) as its preferred location for a new tyre manufacturing and recycling plant.
This was after the company experienced setbacks at another site elsewhere in SA which it had initially earmarked for the development.
The metro said the proposed investment would establish a regional manufacturing hub capable of producing up to one-million passenger vehicle tyres a year and create about 800 permanent jobs.
Mayor Babalwa Lobishe said attracting strategic investments remained at the centre of the municipality’s economic recovery and growth agenda.
“Nelson Mandela Bay is ready to compete for global investment,” Lobishe said.
“We are determined to create an enabling environment where investors can establish, grow and contribute meaningfully to our local economy.
“Every major investment we secure creates employment, stimulates local businesses, expands our manufacturing capability and restores confidence in our city as an investment destination.”
She said the Sailun Group was undertaking feasibility studies to build a regional tyre manufacturing hub that would serve the Southern African Customs Union and the broader Sub-Saharan African market.
Lobishe said due to delays affecting its original proposed location, the company was now assessing the Coega SEZ as a preferred investment destination because of its strategic location, world-class logistics infrastructure, availability of industrial land, renewable energy opportunities and direct access to the Port of Ngqura.
In August 2025, it was announced that Egypt had signed a deal with the Sailun Group to build an automotive tyre factory in the Suez Canal Economic Zone, with a total investment of R18bn.
The plant was expected to produce 10-million tyres annually at full capacity, creating 1,500 jobs.
That announcement came the same week as Goodyear SA was permanently shutting its doors at the Kariega plant.
Lobishe said the proposed development at Coega included an investment of about R2bn, a 20-hectare manufacturing facility, an estimated 100,000m² production footprint, embedded renewable energy generation and battery storage systems.
The plant would use treated industrial return-effluent water to support sustainable manufacturing practices.
During its initial phase, the facility was expected to produce 300,000 truck and bus tyres a year, in addition to one-million passenger vehicle tyres.
According to the municipality, the investment is projected to create about 200 direct jobs during the initial operational phase, growing to about 800 permanent jobs, while generating more than 1,200 indirect employment opportunities across construction, logistics and supporting industries.
Lobishe said the investment also presented an opportunity to reinforce the Bay’s reputation as SA’s automotive capital while contributing meaningfully to national industrialisation objectives.
“This investment is about far more than a manufacturing plant,” she said.
“It is about restoring confidence, creating hope through sustainable jobs, strengthening our industrial economy and demonstrating that Nelson Mandela Bay is open for business.
“We will continue working with all spheres of government and our strategic partners to unlock opportunities that improve the lives of our residents and grow our local economy.”
Eastern Cape premier Oscar Mabuyane said the move by the Sailun Group was an encouraging vote of confidence in the province’s industrial potential.
“While the investment remains subject to the outcome of the feasibility process, it reflects the growing recognition that the Eastern Cape offers a unique combination of world-class logistics, industrial infrastructure, access to renewable energy, deep-water port facilities and an established automotive manufacturing ecosystem.
“Importantly, this is not simply about attracting another factory.
“It is about deepening industrial localisation and strengthening South Africa’s automotive value chain.”
Mabuyane said the availability of critical industrial inputs such as carbon black at the Coega SEZ, together with the concentration of automotive manufacturers, created a compelling business case for downstream tyre manufacturing in the Eastern Cape.
“If realised, this investment would also signal that international manufacturers increasingly view the Eastern Cape not merely as a market, but as a strategic production base from which to serve Southern Africa and the wider African continent under the African Continental Free Trade Area ,” he said.
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