Steering in uncertain territory: E-Business, globalisation and the South African automotive components industry

Abstract

Significant and sustainable growth of the South African automotive components industry is contingent upon its ability to compete in a global, e-business-enabled operating environment. The key challenge facing the South African automotive component industry today is one of connectedness to global trade networks, the generation of export volumes and industrial upgrading in global-scale value chains. The domestic components industry will need to leverage e-business for supply chain management and to take part in global trade networks, thus making it urgent for firms to develop IT capabilities. By not making the transition to e-business, component firms may be placing themselves at risk of becoming less competitive in the globally interconnected market, impacting on both their current market positions and long-term viability. If this were to happen, it would have adverse development implications for the country, such as job losses, a decline in revenue growth and an eroded export base.