The review of the Motor Industry Development Programme

Abstract

The development of a specific sector could enhance a country’s economic growth by facilitating its global positioning. However, some sectors may require government support to enable meaningful economic contribution. The South African government has invested significant amounts of tax revenues in cultivating the potential of the South African automotive industry. Since 1995, support has been given to the industry via the Motor Industry Development Programme (MIDP). The MIDP will be concluding in 2012, and will be replaced by the Automotive Production and Development Programme (APDP). The APDP will extend support to the South African automotive industry until 2020. The question is whether the revised framework of government’s support to the automotive industry will improve its achievement of policy objectives. The present study aims to answer that question by measuring the performance of the MIDP and the anticipated performance of the APDP against formulated critical success factors (CSFs). In order to develop the specific CSFs, it was necessary to identify the objectives for both programmes. This was to facilitate the formulation of common benchmarks to enhance the comparability of research results. A knowledge base in the form of a literature review was created focusing on the objectives, policy instruments and performance of both the MIDP and the APDP. A quantitative approach was followed in executing the benchmarking process. A survey was chosen as the data collection instrument for obtaining the perceptions by the South African automotive industry stakeholders of the performance by the MIDP and the anticipated performance by the APDP. Research results indicated that most of the MIDP’s objectives have been achieved. Despite some uncertainty concerning the anticipated performance of the APDP, it appears that there is an expectation that the APDP will continue building on the MIDP’s performance and that it has been successfully transformed into a World Trade Organization compliant programme.