DaimlerChrysler South Africa Begins Production for World Markets     

STUTTGART - September 20 DaimlerChrysler's East London plant today joined the company's global manufacturing network as the source of the Mercedes-Benz C-class for right-hand-drive markets world-wide.

The first unit rolled off the line soon after midday as South Africa's President Thabo Mbeki and DaimlerChrysler Chairman Jürgen E. Schrempp jointly inaugurated production at the plant.

DaimlerChrysler has invested more than EUR 200 million (Rand 1,4 billion) on upgrading facilities, equipment and skills at the plant. Most of the investment is centered on a new high-tech body shop similar to the Mercedes-Benz plant in Bremen, Germany.

Opening the new production line, Mr. Schrempp told guests: "This is a great day - an historic day - for DaimlerChrysler in South Africa. This is the single biggest investment we have made in South Africa since we began assembling cars and trucks here 42 years ago. As a result, this plant enjoys front-rank status as a center of competence and quality in Mercedes-Benz's global manufacturing network. We plan globally; we produce locally, to a worldwide standard of manufacturing excellence. This day is hard evidence of our intentions: DaimlerChrysler is here to stay."

Professor Jürgen Hubbert, Member of the board of Management, responsible for Mercedes-Benz passenger cars and smart: "The construction of our most modern plant in South Africa represents a logical step in our global expansion strategy. The global Mercedes-Benz Production System (MPS) and solid integration in the international production network ensure the highest standards of 'Made by Mercedes-Benz' for the right-hand drive version of the new C-Class. In addition, the East London facility enables us to better service the exceptionally great demand for the new C-Class worldwide."

The production line uses the very latest in automotive robotics technology to clamp the car bodies and apply some 4,700 spot welds. Laser measuring stations situated at various stages along the line employ more than 100 laser beams to ensure that the car bodies conform precisely to Mercedes-Benz's centrally determined design specifications and quality standards. The R 500 million paint shop is the most sophisticated of its kind in the southern hemisphere. Here the cars are precision-coated with low-pollution, water-based paints applied in a strictly controlled, dust-free environment.

DaimlerChrysler has also invested heavily in skills training and education. The East London plant was linked to the Bremen plant by way of a mentoring program which saw about 300 East London spending up to three months at a time in Bremen being trained on the C-Class production line there. These technicians, accompanied by trainers from Germany, have returned to South Africa to train other trainers and so 'multiply' the skills base.

"We spent 120 million Rand on a skills training program", said Christoph Köpke, Chairman of DaimlerChrysler South Africa. "And I believe, that this is some of the wisest money we ever spent. The cars we make in this plant already meet our best, our highest, our global standards of manufacturing excellence."

The East London expansion program has created 800 new jobs in the company, and an estimated further 3,000 in the local automotive supply industry. Further investment and growth in the South African context is evidenced through mergers, acquisitions and joint partnerships having led to the establishment of over a dozen new suppliers in the region. The plant and its domestic supply chain industries are gearing up to produce 40,000 units a year. This will more than double DaimlerChrysler South Africa's annual turnover, to more than R 120-million in 2001.

The East London plant has had an illustrious history since it was founded in 1948. It has made close than 0,5 million passenger cars and 150,000 commercial vehicles, mostly for the South African market. Its export program began to pick up steam in August 1998, and it has since sent more than 2,000 units of the C-Class's predecessor to Australia.