Dunlop proceeds with R1.7bn investment in Ladysmith tyre factory

Tyre manufacturer Dunlop is forging ahead with a R1.7-billion investment project at its factory in Ladysmith, KwaZulu-Natal, with the backing of its Japan-based parent company Sumitomo Rubber Industries (SRI).

The investment will boost local tyre production capacity as local automotive original-equipment manufacturers (OEMs) increasingly seek domestic tyre producers to meet their vehicle specifications.

The investment drive was announced during the fiftieth anniversary of Dunlop’s Ladysmith manufacturing plant. The production facility first opened its doors in October 1973.

SRI subsidiary Sumitomo Rubber South Africa (SRSA) manufactures Dunlop tyres and also distributes the Sumitomo and Falken tyre brands.

Speaking during a visit to the plant on October 2, Trade, Industry and Competition Minister Ebrahim Patel said the investment would provide a boost to local production, strengthen the factory's output and support local jobs.

SRSA CEO Lubin Ozoux said the milestone anniversary for Dunlop came at a critical time.

“With the backing of our parent company, we are investing significantly into our passenger car radial production facility to make a larger impact in the automotive industry.

“The plant will be able to run a wider set of products, producing more tyres that meet and exceed OEM specifications, and that are safety-tested for all South Africans. At the same time, it gives us the opportunity to continue our investment in our local community and municipality,” he said.

“The new investment will aid in the modernisation and improvement of the plant. It also marks a significant step toward achieving President [Cyril] Ramaphosa's R2-trillion target for new investments over the next five years.”

Patel celebrated South Africa’s 88-year history of tyre manufacturing, with the Dunlop Ladysmith plant being Africa's largest tyre producer.

“The investment announced today serves as a clear signal of the confidence that international investors have in South Africa and reflects the progress we have made with the South African Automotive Master Plan," Patel said.

Japanese Ambassador Ushio Shigeru also expressed his support for the future of South Africa’s automotive industry and initiatives for expanding electric vehicle (EV) production and the EV market.

“It is a pleasure to see SRI's further successes in its local operations, which has brought skills development and local youth empowerment,” he said.

Dunlop holds about 20% of the local OEM market and has agreements in place with car brands Toyota, Nissan, Isuzu, Hino, Tata, Scania and UD Trucks, effectively resulting in one-in-five vehicles on South African roads being factory-fitted with tyres produced from the Dunlop Ladysmith plant.

The investment includes new plant equipment and machinery, such as a new mixer, new tread line and new sidewall line, which will increase passenger car tyre production capabilities, efficiencies and product offering to further support the OEM market.

This comes on the back of SRSA’s multibillion-rand investment in 2018 in a 180 000 m² truck and bus radial (TBR) factory at the plant, facilitating the local manufacture of truck and bus tyres.

With demand for a global reduction in the automotive industry’s environmental impact, Dunlop’s new high-spec, technology-driven equipment and optimised production processes are said to reduce the plant’s environmental impact, aligned to SRI’s global sustainability goal of zero carbon emissions by 2050.

“The new equipment will improve current process capability and decrease our overall plant waste by over 60% once the investment is complete. Power consumption will be significantly reduced, and the equipment will also have the capability to produce very low rolling resistance tyres that will help meet future emissions requirements for OEM manufacturers who choose to use our products.

“Our new mixer, with improved technology, will result in an energy saving of approximately 300 kWh,” Ozoux pointed out.

SRSA holds significant market share in Africa with a branded presence in 23 African countries, supplying car, van and sports utility vehicle tyre markets in Nigeria, Côte d'Ivoire, Kenya, Zambia and Zimbabwe.

Dunlop hired 1 257 people into the company between 2014 to 2023, made up of permanent staff members, expats, temporary employees, fixed-term employees, graduates, in-service trainees, apprenticeships, and learnerships, with 90% of employees residing in the uThukela district municipality, within which the Alfred Duma local municipality is located.

“Dunlop plays a vital role in the Ladysmith economy, as we are one of the largest employers in the town.

“In addition, our spend in the local economy has a multiplier effect on job creation and sustaining local businesses. We have endeavoured to source locally, and a local Ladysmith supplier has been developed as SRSA’s main mould management vendor,” Ozoux said.