Stellantis Reviews South African Factory Plans

Stellantis is reassessing plans for its proposed vehicle manufacturing plant in Gqeberha, and a decision on the project’s future is expected within the next few months. The global carmaker first announced the investment in 2023, outlining plans to build its first South African manufacturing facility to produce the Peugeot Landtrek pickup. Construction was expected to be completed last year, but the project has since been placed on hold while the company reviews changing market conditions.

Instead of  producing a single vehicle, Stellantis is now evaluating a manufacturing strategy that could accommodate several models, giving the company greater flexibility as consumer demand and export opportunities continue to evolve.

Speaking during a briefing on the company’s Middle East and Africa business, Stellantis South Africa Managing Director Mike Whitfield said the project remains under active consideration.

“We certainly have not stopped that process. We put it on pause,” Whitfield said.

According to Whitfield, the biggest factor behind the review is the rapid growth of lower-priced vehicle imports from Asia, particularly Chinese manufacturers.

He noted that locally assembled pickups accounted for about 94% of Africa’s pickup market three-and-a-half years ago. Today, that figure has fallen to just over 70% as brands offering vehicles below the R400,000 price point continue to expand across the continent.

The changing market has prompted Stellantis to reassess both its production plans and export strategy before committing to a final investment decision.

Whitfield said the company expects to provide greater clarity on the future of the Gqeberha project within months.

Greater Reliance on Asian Supply Chains

While Stellantis already works with Chinese manufacturers Leapmotor and Dongfeng in Europe, Whitfield said the company is not considering sharing its planned South African factory with either business.

Instead, Stellantis intends to increase vehicle sourcing for the South African market from Asia, including China, to remain competitive.

“The Chinese have done a superb job. You can’t take that away from them, and to be competitive, we need to source with the same degree of competitiveness,” he said.