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South African Car Manufacturers Halts Production As Strike Persists

South African Car Manufacturers Halts Production As Strike Persists

Car manufacturers in South Africa have started to feel the weight of a two week old metal workers strike, with already two operators shutting down their production as supply components dry up.

In the wake of a gruesome five month long platinum miners’ strike that stalled the Africa’s second largest economy, workers in the engineering and metal industries have been calling for pay rises of between 12-15 percent, which employers say they cannot afford.

Already Ford and General Motors have already suspended some operations, while Japanese car maker Toyota said it will halt production at its Durban assembly plant from Tuesday, BBC reported. Production at BMW and VW was normal, company officials said on Monday.

The strike has also affected mines and telecom firms which rely on their products.

South Africa’s metal workers union, National Union of Metalworkers of South Africa (NUMSA), however rejected a 10 percent pay increase offer by employer this year, followed by 9.5 percent and 9 percent in subsequent years.

Irvin Jim, NUMSA’s general secretary, was quoted by BBC saying that its 220,000 members would not accept anything less than a 10 percent annual increase over three years. There is however hope that a deal will be struck in the next few days.

The strike has damaged wider investor sentiment in Africa’s most advanced economy, which is teetering on the brink of recession after a first-quarter contraction caused in part by the platinum strike.