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Trans African Concessions (TRAC) this month kicks off roughly R1-billion in upgrade and rehabilitation work on the N4.

The N4 toll route is a build-operate-transfer road, and is about 570 km long. TRAC has a 30-year concession with the South African and Mozambican national roads agencies to develop, manage and maintain the road.

The toll route starts from Solomon Mahlangu off-ramp in Tshwane and ends at the Maputo harbour in Mozambique.

TRAC says it routinely undertakes a range of construction projects along the route, including routine pavement rehabilitation and strengthening, as well as major upgrades such as road widening and the construction of new bridges and interchanges.

This month, main contractor TauPele Construction has started work on a R570-million project to rehabilitate the N4 from Solomon Mahlangu drive in Pretoria to the nearby town of Bronkhorspruit.

The expected completion date is July 2027.

Also starting is a R393-million project to rehabilitate the section of the N4 from the Van Dijksdrift Interchange to Wonderfontein.

The main contractor is ACTOP Construction.

TRAC adds that work is progressing well on its other contracts.

The upgrading and rehabilitation of the Schoemanskloof section is 20% complete.

Work started in October last year, with the expected completion date October 2027.

The main contractor here is also TauPele Construction.

The Crocodile Gorge upgrade started in March this year, and is scheduled for completion in February 2028.

Work is 7% complete, and the main contractor is Raubex Construction.

The rehabilitation of the N4 between Hectorspruit to the Lebombo border post started in May, and is expected to be completed in May 2027.

Construction under Roadspan/WBHO JV as the main contractor is 5% complete.

Work on the stretch of the N4 between the Ressano Garcia border post to the Moamba interchange is 10% complete and includes the rehabilitation of the highway, as well as the construction of a new passing lane.

Work started in October last year and is scheduled for completion in December 2027.

The main contractor is WBHO Projects Mozambique.

Trade, Industry and Competition Minister Parks Tau has dismissed as "disingenuous" calls for the exclusion of individuals with links to the African National Congress (ANC) from being appointed to the board of the Industrial Development Corporation (IDC).

At its meeting on June 25, Cabinet named the following appointments to the board of the State-owned development finance institution, subject to the verification of qualifications and relevant security clearances: Dr Gloria Serobe (chairperson); Reon Barnard; Sam Bhembe; Tanya Cohen; Ayanda Dlodlo; Dr Nomusa Dube-Ncube; Dr Keitumetse Mothibeli; and Dr Sydney Mufamadi.

Following the release of the names on June 26, a statement was issued indicating that the Cabinet Office had been made aware that one of the appointees had a conflict of interest and that the matter would be rectified at the next Cabinet meeting.

The identity of the individual was not provided, but an IDC media statement issued on June 27 to welcome the new board members made no mention of Sam Bhembe, a previous client of the institution, who had once been involved in a legal dispute with the IDC.

Political attention, however, had focused primarily on Ayanda Dlodlo, Dr Nomusa Dube-Ncube and Dr Sydney Mufamadi, given their well-known associations with the ANC. Dlodlo and Mufamadi are former Cabinet Ministers, while Dube-Ncube is a former KwaZulu-Natal Premier.

The opposition Economic Freedom Fighters (EFF) expressed immediate concern over the three appointments, and has even threatened legal action.

During a debate following Tau's Budget Vote speech on July 4, EFF MP Chumani Matiwane criticised what he described as the use of "strategic entities to enrich political allies", specifically naming Dlodlo, Dube-Ncube and Mufamadi.

Despite being part of one of the parties participating in the Government of National Unity, Democratic Alliance MP Toby Chance juxtaposed the performance of Andrew Whitfield, who was recently dismissed as Trade, Industry and Competition Deputy Minister for undertaking an unauthorised trip to the US, against "members of the executive feathering their own nests".

While also highlighting the three appointees, alongside Gloria Serobe, who he described as an ANC stalwart, he questioned how Tau could expect South Africans to view the appointees as "anything other than ANC deployees, instructed to do the party's work".

In response, Tau highlighted Mufamadi's qualification and experience as an "industrial economist" and Dlodlo's experience as an executive director at the World Bank.

"There is a problem when we sit in Parliament and say to society that Dr Sydney Mufamadi, who is an industrial economist, simply because of his affiliation to the ANC is not legitimate to serve on a board - he's an industrial economist, he lectures in this subject.

"You cannot say that a person who has served in the World Bank, in the form of Ayanda Dlodlo, is not eligible to sit on the board, because then you are not taking advantage of the skills you have created as a country and the exposure of the people of your country to particular platforms.

"It is disingenuous to simply suggest that capability is limited by the fact that you are affiliated to the ANC," he said against audible protests from the opposition benches.

Trade, Industry and Competition Minister Parks Tau has reaffirmed South Africa's 'Butterfly Strategy' for trade and exports, amid ongoing uncertainty over the future of trade relations with the US and concerns about the potential impact of the EU's carbon border adjustment mechanism (CBAM) on exports to the bloc.

In his Budget Vote address, Tau said the butterfly strategy had its trade and export body rooted in Africa, with the "game changing" African Continental Free Trade Area (AfCFTA) Agreement as its central component.

"From this centre, two wings unfurl - one reaching westward across the Atlantic, the other eastward across the Indian and Pacific oceans - carrying with them the ambition of South African enterprise," he ruminated.

The vision, Tau added, was for Africa to move from the periphery of global trade and for South Africa to transition from being primarily an exporter of goods to "a creator of value" and a connector of regions.

"We celebrate the rise of South African value-added exports under the AfCFTA to R820-million, but this is just the beginning."

An automotive pact was also being finalised to integrate South Africa's manufacturers into regional supply chains, while a Protocol on Digital Trade was also being progressed to position Africa as "our bedrock, resilient market".

In addition, Tau announced that an Export-Import Bank of South Africa would be fully operational by 2028, as part of efforts to strengthen the country's trade finance architecture.

In response to questions posed during the Budget Vote debate regarding fraught relations with the US, which could impose 31% tariffs on South African exports should the reciprocal-tariff pause be lifted on July 9, Tau again noted that a comprehensive offer had been made to "normalise" relations.

The offer, he said, carried "reciprocal benefits", such as buying gas form the US to address the country's so-called gas supply cliff in return for concessions for South African steel and automotive exports, as well as an intensification of counter-seasonal agricultural trade.

South Africa was also pursuing a Clean Trade and Investment Partnership (CTIP) with the EU to mitigate the potential impact of CBAM, which South Africa would continue to oppose in parallel, potentially at the World Trade Organisation.

Instead of "wallowing in self-pity" over CBAM, South Africa would seek to use the CTIP to mitigate its impact, with Tau highlighting an initial R90-billion commitment, which he said opened duty-free access for exports in key sectors, such as "dairy for the local production of Amarula, sustainable aviation fuel, new energy vehicles, green hydrogen, and battery components".

Tau added that efforts were also under way to implement the country's framework agreement with China, with a particular focus on diversifying exports to the giant Asian economy, while seeking to unlock trade and investment relations with countries in the Middle East as well as members of the BRICS Plus bloc.

"Through targeted trade missions, specialised exhibitions, and capacity building for exporters, we aim to propel our export value to R3-trillion by 2029/30, a cornerstone of our sustained 3% GDP growth target," Tau said.

Engineering News editor Terence Creamer discusses the plan endorsed by Cabinet to support South Africa embattled ferrochrome sector through export restriction on chrome ore and lower electricity tariffs.

Transport Minister Barbara Creecy has confirmed that a request for information (RFI) will be launched in July to assess the potential for private sector participation (PSP) investments in the passenger rail sector, including into high-speed rail links.

The launch follows on from the success of the freight-logistics RFI that closed on May 30 and which elicited more than 160 responses, including 51 in relation to the iron-ore and manganese corridor, 48 for the coal and chrome corridor, and 63 for the container and automotive intermodal corridor.

In an interview with Engineering News, Creecy said the passenger rail RFI was likely to focus on PSP prospects for long-distance routes, including the Johannesburg-Durban link, a Johannesburg-Musina route and a Johannesburg-Mbombela route, which have been identified as possible "rapid rail corridors".

She said the RFI could also test the private sector's interest in investing in depots, signalling and real-estate development within the existing Passenger Rail Agency of South Africa (PRASA) network, which was heavily vandalised during the Covid pandemic.

The move comes as Creecy confirmed that, by the end of May, PRASA had revived 35 of its 40 corridors and had achieved an unaudited figure of 77-million passenger journeys for the last financial year and was targeting 116-million in 2025/26. This remains well below pre-Covid levels of about 600-million passenger journeys.

She also announced that total transfers to the agency would be R66.1-billion over the coming three years, which would be used to maintain, recover and renew infrastructure, as well as to rebuild the signalling systems needed to roll-out new train sets on priority corridors.

As with the freight sector, any commercial procurement arising from the RFI would be managed by a PSP unit being set up by the Department of Transport, together with the Development Bank of Southern Africa (DBSA) and the National Treasury.

Creecy told Engineering News that the unit, which is housed at the DBSA, already had some dedicated staff and should be in place to oversee the initial requests for proposals (RFPs) for the freight sectors at the end of August.

These RFPs would be released in phases across the five rail and port corridors covered by the RFI.

It was not yet clear when the first passenger rail RFP would be launched.

The fundamental challenge many vehicle assembly operations in South Africa currently face is that their operations are becoming less vital to the success of their parent companies.

This is linked to competitiveness challenges in South Africa, says African Industrialisation Services director and Gordon Institute of Business Science (GIBS) associate professor Justin Barnes.

"South Africa has a very advanced vehicle production base, but that base is both export-oriented and dependent on the performance of the domestic market. These two aspects are inextricably linked through the workings of government's Automotive Production and Development Programme (APDP).

"We have a domestic market that is smaller now than it was in 2006, and we have local and national infrastructure which has deteriorated at exactly the same time that we have seen tremendous improvement in other emerging regions of the global automotive industry."

Barnes was responsible for the creation of the manufacturing-focused MBA stream at GIBS and is also an architect of the APDP.

South Africa has seven light vehicle assemblers - Ford, Mercedes-Benz, Nissan, BMW, Toyota, Volkswagen and Isuzu - which are owned and operated by their respective parent companies in the US, Germany and Japan.

The auto industry is the country's biggest manufacturing sector.

In South Africa, the Nissan plant is under threat of closure and Mercedes-Benz has suspended production from late June to August 1. (Read article elsewhere on Engineering News Online.)

Globally, vehicle manufacturers (original-equipment manufacturers, or OEMs) are facing increasing pressure from a rapidly rising Chinese auto sector, the change-over to clean energy vehicles and the threat of US tariffs inflating the cost of doing business.

Some OEMs are faring better than their competitors. Nissan is in a fair amount of trouble globally, for example, while others are trimming their operations to align their supply capacity with anticipated demand.

"The South African operations are slipping down their global family ladders," notes Barnes. "What that means is that where the South African operations were once firmly among the better performers in their global families - or at least, average in some cases - they are now performing at the lower end of the global operations log.

"This is not due to problems at the plants, but to problems with South Africa's infrastructure - power, roads, ports, rail and water - that all play a role in getting vehicles to market and components to plants.

"What we essentially have is very advanced vehicle assembly operations with some very advanced component manufacturers operating in a not-so-advanced domestic ecosystem," explains Barnes.

"Unfortunately, those chickens are now all coming home to roost - which basically means that if there are global volume problems at an OEM, and the OEM needs to correct their global position, the South African operations step into the firing line.

"This is the problem we are likely to experience across the board, and unless we get our act together and position ourselves more effectively in the global value chain, our automotive industry has become quite vulnerable.

"We are competing in a complex value chain in which there are major shifts occurring, and because we are moving to the margins of the global value chain, we are unfortunately vulnerable to how the incumbent players who are based in South Africa respond to these global pressures when looking at their spread of international assets."

BEE, Local Government Challenges Barnes says South Africa's automotive industry could have an important role to play in a rapidly changing global environment. However, this is only possible if the country improves its infrastructure and skills pipeline, and if it stops enforcing empowerment and equity demands on multinational companies.

"Black economic empowerment (BEE) codes in their present form act as a huge constraint on multinational companies.

"Yes, the country des...

Transport Minister Barbara Creecy confirmed that Transnet will issue requests for proposals (RFPs) from the end of August to begin the formal procurement process for private sector participation (PSP) across five priority rail and port corridors.

In her Budget Vote address to the National Assembly, Creecy reiterated that the limited availability of State resources to fund infrastructure development made private sector investment critical, albeit under a framework whereby rail lines and ports would remain under public ownership.

She said the recently concluded request for information process would guide the RFPs for private investment on freight-logistics corridors that moved key mineral exports and containers.

However, she also stressed that South Africa could not wait for these PSPs to reach financial close (a process that is expected to take two years to complete) before rehabilitating Transnet's rail network and rolling stock, as well as port infrastructure and equipment.

She said three funding sources would be tapped for the immediate rehabilitation effort, including:

Transnet's budget for rail and rolling stock maintenance and the purchase of port equipment, which was currently underpinned by government guarantees and which was likely to receive additional guarantees in July; submissions to the National Treasury's Budget Facility for infrastructure (BFI); and private investment in refurbishing or expanding line capacity through existing customer agreements.

In a media briefing, Creecy confirmed that Transnet had submitted an initial application under the BFI for about R16-billion and would also seek another R14-billion when the next quarterly bid window opened in October.

No immediate indication was provided as to what projects the BFI funding would support, but she expressed optimism that Transnet would secure the funding.

Creecy also provided no estimate for the possible investments that could be unlocked through co-funding arrangements with existing customers, or how such customers would be compensated.

Much would depend, she indicated, on the framework being developed with the National Treasury for such co-funding, which would clarify what was legally allowable and the compensation mechanism.

The Minister also confirmed that she would be seeking to address vacancies and capability gaps on the Transnet board, including by appointing a Chartered Accountant and two individuals with rail industry experience.

The Energy Council of South Africa is strongly supportive of the goal of launching the initial phase of the South African Wholesale Electricity Market (SAWEM) in early 2026, arguing that the platform is key to sustaining reform momentum in the electricity sector amid signs of a slowdown.

The National Transmission Company South Africa (NTCSA), which has applied for a Market Operator licence, has indicated the SAWEM will be launched in a phased approach starting on April 1.

The SAWEM will be launched through Eskom power stations, as well as those independent power producer (IPP) generators that have been procured through public auctions to create transparency and confidence in the operations and oversight of the platform, before bringing in private sector generators and market participants.

The subsequent phase of development will be focused on 'system balancing' by mandatory participation of all 10 MW-plus generators. Balancing is viewed as an important step in market functionality as all generators must be compliant and develop capabilities to accurately forecast, nominate, schedule and settle their generation profile on an hourly basis in the day-ahead market.

Several milestones would have to be achieved to meet the proposed SAWEM launch schedule, including securing the regulatory approval for the Market Code, the Market Operator licence, the wholesale tariff rules and vesting contracts with Eskom stations. Section 34 IPP's will have their existing power purchase agreements linked to the market as legacy contracts which along with the vesting contracts will be administered and settled in the SAWEM by the Central Purchasing Agency.

CEO James Mackay tells Engineering News that, while there is much scepticism about the ability to meet the deadline, the council believes it will be a crucial signal of South Africa's ongoing commitment to the restructuring of the sector to meet government policy and legislation for a liberalised market with competitive generation.

The traditional centralised and monopoly utility control, he says, is not suited to managing the changing sector energy mix, variability and decentralised investment. With the added pressure of an over reliance on poor performing, large coal-fired power stations, this reality has been in strong evidence since 2007 when South Africa first descended into loadshedding, which intensified to the point of almost daily power cuts in 2023.

Despite the successful stabilisation and end of "structural" loadshedding, Mackay says the risk of loadshedding is still real at current reliability levels. He further adds that there is broad consensus, including with key government role-players, that South Africa needs to add between 4 000 MW and 5 000 MW of new renewable generation capacity yearly, plus accelerate battery storage deployment and develop gas to power in preparation for the retirement of several aged coal stations.

The slow pace of introducing new generation has already delayed that retirement programme; a development that required the granting of exemptions to several coal power stations from meeting air pollution standards.

He says that, while the next three to five years are critical for the sector, there are signs of a slowdown in reform momentum. This, partly because of insufficient physical grid infrastructure to connect the new capacity, but also because of lags in finalising the regulatory frameworks for implementation.

The highest-profile fallout of this lag is Eskom's ongoing objection to the issuance of licences to traders on the basis that the rules are not yet in place, despite the Electricity Regulation Amendment (ERA) Act, which came into force this year, pointing to a key role for traders in the market.

Mackay acknowledges the progress being made to expand the grid and to accelerate the process through private sector participation, but is concerned about what will be a critical shortage specifically between 2028 through to 2030 which he describes as a key per...

National Association of Automotive Component and Allied Manufacturers (Naacam) CEO Renai Moothilal says production plant volume cuts have become all too common in South Africa's vehicle assembly sector over the past two years.

This assessment comes as Mercedes-Benz South Africa (MBSA) suspended C-Class sedan manufacturing at its East London assembly plant until the end of July, owing to having sufficient volume in stock to meet current demand.

Moothilal says component manufacturers were made aware of the shutdown several weeks in advance.

"Other than the obvious uncertainty and market issues arising out of the tariff situation in the US, this planned closure is synonymous with what has been observed in the South African vehicle assembly sector for around two years now.

"This has a significant impact on business sustainability of component manufacturers."

Moothilal adds that Naacam has tracked multiple local component plant closures and job losses over the past two years, "which can be seen as directly correlating with the inability to produce at the predicted planned volumes from when a vehicle platform was first announced by the customer vehicle assembler, and this has happened at several assemblers in South Africa since 2023".

He says this year's expected policy review of government's Automotive Production and Development Programme (APDP), under the leadership of the Department of Trade, Industry and Competition, will urgently need to find ways to cushion component companies against this debilitating scenario. At present the vehicle manufacturers receive the highest share of APDP incentives, including a mix of cash and duty rebates based on vehicle assembly and domestic value add.

"If this does not happen, the localisation and employment goals of South Africa Automotive Masterplan (SAAM) 35 will not be achieved," notes Moothilal.

At the time of the drafting of the masterplan - 2016 to 2018 - the average local content in South African assembled vehicles was below 40%, ranging from around 30% for high-technology, high-value passenger vehicles, to 45% for light commercial vehicles and smaller passenger vehicles.

Almost ten years on nothing has changed, says Moothilal.

The SAAM 35 localisation target has been set at 60% by 2035.

The goal is also to double employment in the automotive value chain, from around 112 000 people to 224 000 people.

August 1 Return An MBSA spokesperson says the East London plant is scheduled for a planned non-production period from June 24 to July 30.

"An annual non-production period at the East London production plant is standard procedure and it is common cause for production plants to suspend production based on volume adjustments in the production programme."

The plant is scheduled to resume a two-shift-a-day operation from August 1.

Tariffs and a Tough Market MBSA is heavily dependent on exports to ensure the viability of the local plant as South African premium market sales have plummeted, especially in the face of Chinese imports and a strong buying-down trend.

More than 90% of MBSA production at East London is exported to more than 80 markets worldwide.

MBSA's parent company is also facing its own challenges, including a sluggish German domestic economy, US tariff threats and surging Chinese imports.

The German car maker stated in April that it expected "material impacts" on its financial results, "assuming all of the currently implemented and the announced tariffs become effective and remain in place until the end of the year".

In May, year-to-date total new EU car registrations fell by 0.6% compared with the same period last year.

Also, up until May, battery-electric cars accounted for 15.4% of the total EU market share - an increase from 12.1% in May 2024 year-to-date.

Mercedes-Benz came in at number ten in May among the top 25 most registered battery electric vehicle brands. Volkswagen was at number one and BMW at number three. Both these car makers also have South African plants.

In addi...

Explosives and chemicals group AECI is expecting an operational recovery at its iconic Modderfontein plant in the second half of 2025, following a difficult first few months to the year when output was affected by a disruption to the supply of electricity and a key input material.

However, the long-term outlook for the site, which has been a feature of the South African industrial landscape for more than a century, is uncertain.

CEO Holger Riemensperger reports that Modderfontein experienced an unprecedented 16 power interruptions during the first four months of 2025, despite its status as a national key point that is not disrupted even during loadshedding and being on the same power infrastructure as the OR Tambo International Airport.

While the facility has experienced some difficulties in the past given South Africa's multidecade-long electricity supply imbalance, which culminated in a period of almost daily cuts in 2022 and 2023, Riemensperger tells Engineering News & Mining Weekly that it has never before faced this level of disruption.

Even a five-second power cut, he explains, results in a full day of lost production, owing to the time it takes to ramp up the plant, and AECI estimates that the 16 incidents cost it about a month of lost output.

There have been intense engagements with Eskom over the problem and there have been no further interruptions since April.

However, Modderfontein also declared force majeure during the first quarter, owing to inadequate supply of an input material known as lead azide, which is supplied by another State-owned entity, Denel, and used to manufacture non-electronic detonators.

Owing to the fact lead azide is too unstable to import, the JSE-listed group has dispatched a technical team to the Denel unit to help improve production.

Nevertheless, supply of the material has become a structural risk and AECI has, thus, identified a replacement input, which is expected to be ready for integration into the manufacturing process in about a year's time.

In parallel, AECI is assessing the future of the Modderfontein site, which has been in operation for 126 years and where the vast tracts of farmland that once surrounded it have been progressively developed into residential and light industrial properties.

Asked by Engineering News & Mining Weekly what the future holds for AECI's facility at Modderfontein, Riemensperger responded as follows: "There are many questions around that site and how to take that forward, which is something that we will deal with in the second half of this year, and we intend to provide to the market a very clear way forward in our November capital markets day."

He highlights, too, that an analysis of AECI's mining services business shows that 95% of its explosives business is based in Australia, Ghana, the Democratic Republic of Congo, Zambia and Botswana.

"There are another 17 countries that we operate in that share the other 5% between them," he explained, implying that Modderfontein is already a modest part of the explosives business despite its substantial historical contribution.

The Modderfontein review comes amid an already far-reaching restructuring of AECI, which has been under way for two years and which involves the disposal of businesses that are not core to the group's current stated ambition of being a top-three global supplier by 2030 in its selected market segments of mining explosives, chemicals and technology.

During the first five months of 2025, the group sold its Much Asphalt business for R1.1-billion, which was a major contributor to it being in a position to pay off R1.4-billion of debt, and enabled it to transition to its targeted debt levels.

The group's net debt position as at May 31, 2025 was R3.4-billion, down from R4.7-billion, and translating to a gearing ratio of 28%.

Further disposals are being pursued across various noncore agriculture, water and chemicals units, including the Schirm business, where the disposal of the German business ...