Nedbank’s latest Capital Expenditure Project Listing report revealed that VW committed to a R4-billion investment in 2024 at its Kariega, Eastern Cape plant in preparation for a new SUV that is scheduled to enter production in 2026 or 2027.
Additionally, Toyota South Africa in a joint venture with Ogihara Thailand Corporation pledged R1.1 billion to establish a new automotive component manufacturing facility at the Dube TradePort in KwaZulu-Natal, which is expected to support the new production of the next-generation Hilux upon its completion in mid-2025.
The Capital Expenditure Project Listing also showed that the N2 Garden Route saw a R1.5-billion injection from the National Roads Agency (Sanral) last year, while the country’s longest road tunnel, the Huguenot Tunnel, was likewise on the receiving end of a R4.5-billion upgrade.
Other major investments in the transport sector from 2024 include the new Cape Winelands Airport worth R7 billion, which is being funded by RSA. Aero.
Finally, Airports Company South Africa (ACSA) put down a whopping R12.22 billion for an infrastructure overhaul of airports on its portfolio – which includes major sites such as OR Tambo International.
In total, the transport sector saw an inflow of over R30 billion in 2024, accounting for 7% of the R445.9 billion in total capital expenditure projects listed in Nedbank’s report.
The institution notes that 2024 showed the sharpest increase in fixed investment plans in South Africa since 2021, “reflecting a myriad of projects addressing infrastructure backlogs, particularly in road and water systems.”
However, the composition of new projects changed noticeably. Government replaced the private sector as the major driver with plans totalling R199.8 billion, reflecting a 161% jump and accounting for 44.8% of all new projects announced.
Public corporations similarly announced projects worth R150.5 billion, or 33.8% of the total, up significantly from R35.8 billion in the previous year.
Meanwhile, the private sector announced plans amounting to R95.6 billion, or around 21.4% of the total, a decline of 4.3% compared with 2023.
“This sluggishness is unsurprising. Given weak economic growth, the private sector opted to wait-and-see how the May general elections would evolve and whether structural reforms would improve underlying operating conditions. Given the lag between project announcements and implementation, the pickup in investment plans bodes well for gross fixed capital formation in 2025.” said Nedbank.
“Even so, the risks to the outlook remain tilted to the downside, dependent on the public sector’s ability to follow through on its plans and move decisively towards lifting the long-standing infrastructure constraints on faster economic growth and job creation.”
VW’s new budget SUV
VW plans to produce a new budget SUV in South Africa from late 2026/early 2027 that will sit on the same platform as the Polo.
The company’s Eastern Cape plant is currently the sole producer of the venerable Polo hatchback for the entire globe, hence, it requires extra tooling and infrastructure to support assembly of a crossover.
The newcomer is touted as being VW’s return to the budget SUV segment and will be targeted at third-world markets such as Africa and Latin America.
It will feature a petrol engine and is expected to be smaller and, importantly, cheaper than the German brand’s current entry-level SUV, the T-Cross.
While in South Africa it has yet to be named, it will be called the Tera in countries such as Brazil.
VW Tera spy shot. Source: Motor1.com
Next-gen Toyota Hilux
Toyota announced in August 2024 that it would be establishing a new R1.1-billion component manufacturing plant at the Dube Tradeport in KwaZulu-Natal, which is expected to open its doors in July 2025.
The new parts facility will supply a range of necessities including rocker panels, radiator supports, sills, roof rails, body pillars, and rear floor cross parts.
It’s expected that the facility will start production right in time for the rollout of the next-generation Hilux, which is all but officially confirmed for a late 2025 reveal.
Instead of being brand-new from the ground up, the new Hilux will be an extensive upgrade of the existing model.
Spy shots show that the exterior will receive a host of new panels, several of which are among the list of products that will be made at the new Dube Tradeport component plant.
2025 Toyota Hilux Spyshot. Source: HeadlightMag
Huguenot Tunnel
The Huguenot Tunnel upgrade project kicked off in 2024 and is expected to continue for five years.
The work will encompass the construction of a new North Bound Tunnel and the modernisation of the South Bound Tunnel.
As per the Western Cape municipality, the new North Bound Tunnel will be completed by 2027, after which motorists will be able to use it while the South Bound Tunnel is closed for a year.
Upgrades to the South Bound Tunnel are already underway and, once completed, the two tunnels will offer two lanes each.
While the project was delayed for several years, the Sanral Board was recently instructed to put it out on tender so as to accelerate the completion of the important initiative.
Airport upgrades
Projecting a significant uptick in air travel over the coming years, ACSA is setting out to improve the cargo and logistics area of the nation’s biggest airport, O.R. Tambo International.
Starting in the 2025 financial year, the refurbishments are meant to restore ACSA’s airport infrastructure following the pandemic and expand its capacity to accommodate the next decade of growing passenger and freight demand.
Over the next three to eight years, several other airports around the country will also be enhanced, with the total budget set aside for the lengthy initiative coming in at an astounding R21.7 billion.
Cape Winelands Airport
The new Cape Winelands Airport is scheduled to open in 2027 and will offer both domestic and foreign flights, accommodating much of the inbound traffic to the Western Cape.
The site was first established in 1943, with a small landing zone intended for non-commercial civilian flights.
However, a R7-billion investment in the privately-owned airstrip will help to convert it into a commercial-grade airport with facilities on par with South Africa’s other major travel hubs.
In contrast to Cape Town International, which is located on the N2 leading into the city centre, the Cape Winelands terminal is located further out in the heart of Durbanville, effectively making it a gateway to the region’s famous wine farms.
N2 Garden Route
The R1.5-billion N2 Garden Route investment forms part of the larger N2 Wild Coast Road Project which has been ongoing for a number of years.
The initiative comprises a major 110km upgrade to one of the country’s most important connectivity roads which will reduce travel distances and by extension, travel times, between four of the nation’s biggest provinces – the Western Cape, Eastern Cape, KwaZulu-Natal, and Mpumalanga.
Among the developments will be two major bridges namely the Msikaba and Mtentu bridges, the former of which will be the longest suspension bridge in South Africa, and the latter of which will be the tallest bridge on the African continent.
Artist’s rendering of the Msikaba Bridge. Credit: DissingWeitling
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