Home » Business » IDC Proposes a ‘Completely Knocked Down’ Policy

THE Industrial Development Corporation is proposing a ‘completely knocked down’ policy that allows car dealers to import kits to be assembled at Willowvale Mazda Motor Industries, Quest, Dahmer or Deven, for both passenger and commercial vehicles.This would halt loss of employment, enhance technology transfer and value addition in components and assembly instead of preferring imported completely built up vehicles and second hand imports.

IDC statistics show that the number of new vehicle imports has declined dramatically since dollarisation to about 5 800 in 2013 (both completely built up and completely knocked down) in favour of completely built up second-hand mainly ex-Japan.

IDC general manager Mr Mike Ndzudzo said the new car business requires long term customer funding like hire purchase and lease hire.

Such facilities were in the past given by private financial institutions like UDC and Scotfin to corporate and high net worth individuals, who after a period of use of say five years, then offloaded these as local pre-owned cars.

However, large corporate and the State, parastatals and municipalities remain the material volume fleet cash buyers for new cars, hence the Presidential Order for SOEs to buy locally is meant to promote the viability of local industry.

“In our case even State institutions have found excuses to by pass this Order under all sorts of guises, like conditions of service and special specification requirements,” Mr Ndudzo said.

“In the past there were few, if not negligible imports of second hand cars because of the exchange control protection in place. But now some 62 000 second hand cars are imported annually compared with only 5 800 new cars.”

In 1997, the market would have 25 000 new cars, 18 000 of which were assembled locally. He added that if there is not structural market transformation, the whole business will be facing a natural death, together with the downstream companies who were supplying locally batteries, paint, springs, truck bodies, windscreens, seats, radiators, exhausts and leaf springs.

“Zimbabwe must therefore make a strategic choice of whether they want the motor sector to be an integral part of their industrialisation and employment creating strategy, particularly if Ziscosteel is resuscitated,” said Mr Ndudzo.

The IDC has also urged Government to make the motor sector an integral part of the industrialisation and employment creation strategies.

Source : The Herald