The effect of China imports on Smiths Manufacturing's aftermarket division, Dunair.

Abstract

South Africa’s automotive industry has been growing with 37 new brands introduced from 1997 to 2013. The industry has nine local manufacturing automotive plants that produce for both local and export markets while also importing vehicles from their international manufacturing facilities. Local automakers utilize local tier component manufacturers for the parts localization programme. This phenomenon has created an opportunity for international parts suppliers to provide genuine and alternative replacement parts to the South African market for in-warranty and out of warranty repairs. This study investigates the effect of the cheap China copy replacement products on local tier component manufacturers. The objective of this study is to identify the factors that influence the buying decisions of customers and their impact on local suppliers. It will also assist local tier component manufacturers and automakers to formulate strategies that will assist to provide value proposition to customers and industry stakeholders. The study utilized a mixed research design method that acquired secondary data from the independent aftermarket intermediaries and primary data from the researcher’s market analysis. The secondary data was collected from fifty-five intermediaries using questionnaires. Collected data is analysed in the last chapter with detailed recommendations. The findings suggest that the market requires cheaper alternative products that are reasonably priced and available when required.