The Automotive Industry in Lesotho is fairly new. While the country is not yet ready for an overall assembly of vehicles, the plan is to pluck Lesotho into the regional automotive value chains. The country’s competitive advantage lie mostly within the high labour intensive automotive components manufacturers. South Africa’s strong automotive industry provides such an opportunity for Lesotho to explore value chain opportunities within the industry in line with the competitive advantages of abundant and effective labour at competitive wage rates. With introduction of the new Automotive Production and Development Programme (APDP), South African Automotive Strategy aims to increase its production volumes to 1.2 million vehicles per annum by 2020 and substantially diversify and deepen the component supply chain. Lesotho automotive products qualify for local content under the APDP.
Opportunities for Lesotho lie in the manufacture of small components of finished products to support the South African Automotive Industry (OEMs) and in the long term develop capacity to service export markets. Examples of these are the manufacture of leather car seat covers, plastic and leather interior accessories and electrical components.
Lesotho is also geographically central within South Africa and well positioned to supply all automobile manufacturing plants in the RSA: