History of the DAC
The DAC is a well-established and mature public-private partnership (PPP) between the eThekwini Municipality and the automotive manufacturing sector in KZN, created to promote the growth and competitiveness of the local automotive industry. Established in 2002, today the cluster is represented by 40 companies collectively employing approximately 17,000 people. As an industry driven initiative it draws on leadership and expertise of individuals from a broad range of automotive member firms and uses it to identify and address a wide variety of challenges confronting the industry.
Funding for the DAC is overseen by the Economic Development Unit (EDU) of the eThekwini Municipality, which is mandated to promote economic development; job creation, economic transformation and economic intelligence within the municipal region.
The DAC is aligned and works in partnership with the Automotive Supply Chain Competitiveness Initiative (ASCCI) in an attempt to enable suppliers, OEMs, and other stakeholders to increase value add while also increasing localisation and enabling local supply chain capabilities.
As the automotive industry in KZN aims to expand its share of local and international markets, clustering is an important progression from companies operating in isolation, to recognising that there are certain support activities that can be better performed in conjunction with other firms confronting similar challenges. The benefits of clustering include:
- Generating a critical mass of resources
- Shared learning
- Supporting the rapid diffusion of ideas
- Collective action and risk sharing
- Reduced costs
- Enhanced ability to compete on a global platform
The vision for the cluster is to focus on the promotion of the growth and competitiveness of the KZN automotive manufacturing sector.
The mission is to establish mutual competitive advantages and help the sector overcome generic challenges.
The overarching objective of the DAC is to grow the local manufacturing value addition (MVA) by 100% in real terms between 2012 and 2020.
Why our objectives matter
MVA is the value addition through manufacturing; it is revenue less consumables and services. The cluster has chosen to focus on MVA growth as this encapsulates the activities throughout the value chain and will enable both employment and private sector investment growth and will achieve sustainable growth in the long run.
Strategic focus areas
The cluster, in support of the KwaZulu-Natal Automotive Sector, has identified key vision items for the future that must be focused on. These include increased localisation, as well as supporting suppliers in additional areas such as skills, transformation and capital investment.
The DAC’s programmes in 2016 reflect the new strategic priorities and accordingly now comprise the following three programmes:
Our founding principles
The founding constitutional principles of the DAC are incorporated into its memorandum of incorporation under the New Companies Act and this governs the the activities of the DAC. This specifies, amongst other things, objectives, membership requirements, decision making processes and the appointment of a facilitation service provider. In terms of governance, the DAC’s operating model entails industry contributing technical and management expertise to focused Technical Steering Committees (TSCs), with these TSCs then in turn reporting into an Executive Committee comprising both industry and local government representatives.
Cluster facilitation services are provided by an independent team from B&M Analysts appointed by the Executive Committee.
Founded in 1997, B&M Analysts’ primary areas of expertise and service provision include cluster facilitation, competitiveness benchmarking and upgrading, project management, training, and policy and strategy research services. These services are provided to government, non-government organisations (NGOs), clusters, industry associations, and manufacturing companies.
The DAC is a verified Level 4 B-BBEE contributor under the Codes of Good Practice for Broad-Based Black Economic Empowerment (B-BBEE). 100% of expenditure can therefore be claimed as Preferential Procurement. The DAC complies with requirements outlined in the Municipal Finance Management Act (MFMA) and Public Finance Management Act (PFMA).