SEW-Eurodrive has announced that construction has commenced on a new R200 million head office and factory in Everton, Johannesburg. 

The 25 000sqm building is being constructed on property acquired by the company two years ago. The necessary earthworks were completed in late September. Construction is due to be completed by October 2021 and the company plans to move in to its new premises – which will also act as its South African headquarters – in January 2022.

The significant investment by our German parent company, despite the current economic downturn, is indicative of the growth potential we see on the African continent

Over a three to five-year period the period the factory will be fitted with state of the art, industry 4.0 compliant technologies including automated assembly machines and guided vehicles which the company anticipates will cost at least another R200 million.

“In order to remain globally competitive, it’s important that this new factory is as automated as possible,” reveals Raymond Obermeyer, managing director at SEW- Eurodrive South Africa. During a ground-breaking ceremony attended by Mining News, Obermeyer added that the facility would be a good legacy for the company over the next 20 to 30 years.

SEW-Eurodrive invests in new R200 million facility
SEW- Eurodrive’s exco members at the construction site during the ground-breaking ceremony.

The new state-of-the-art, hi-tech facility will allow the company to more efficiently and effectively service customers both in Gauteng and in the rest of Africa, he reveals, adding that the company expects the majority of its growth in the years ahead to come from Africa rather than South Africa. “The significant investment by our German parent company, despite the current economic downturn, is indicative of the growth potential we see on the African continent.” He added that SEW-Eurodrive South Africa currently services 23 countries across Africa.

“We expect African markets to account for 50% of our turnover within the next three to four years, given that growth in many countries around the continent is much faster than it is locally,” says Obermeyer.

SEW-Eurodrive, which specialises in manufacturing and supplying gear motors and units, drive solutions as well as various components and supplementary products and services to the mining, renewable energies and industrial sector, has been operational in South Africa since 1986.

“Not only do we expect to see opportunities for growth coming from the establishment of the African Free Trade Continental Area (AfCFTA) agreement, but the removal of border restrictions will make it significantly easier for companies like SEW-Eurodrive to do business on the continent,” he explained.

The new factory will accommodate a number of the company’s assembly plants around the country in order to develop better efficiencies and contain costs. SEW-Eurodrive’s existing plants in Nelspruit, Durban, Port Elizabeth and Cape Town will continue to operate with a focus on servicing the company’s national footprint of customers, while its current head office and factory will become a large gear box repair centre. By so doing, the company will enhance their service capabilities nationally. “We strongly believe that we must be able to service what we sell,” Obermeyer said.

The construction site of SEW- Eurodrive’s soon to be new head office and factory.

Obermeyer explained that like the rest of the world, SEW-Eurodrive had been impacted by Covid-19 as both the local and global economies struggled to recover from the consequences of the lockdown during the pandemic. “Our business, like many others, is sensitive to a slowdown in economic growth. However despite the slowdown, South Africa cannot afford to ignore the need for very necessary maintenance of our critical infrastructure.” He stressed that efficiently functioning infrastructure was essential for the country to achieve economic recovery. “By their very nature, infrastructure are expensive assets, which once developed require ongoing maintenance to ensure they are optimally functional for as long as possible.”

According to Obermeyer, it is imperative to continue investing for the future in order to accommodate the globalisation and digitalisation potential. “This new facility which has been in planning for several years paves the way for our growth trajectory – allowing our South African operations to act as a springboard for growth in the African continent,” he concluded.

Additional Reading?

Request Free Copy