Dunlop opens new distribution centre to use the growth in South Africa market

South Africa: As the parent company Sumitomo Rubber South Africa (Pty) Ltd (SRSA), is making a series of investments globally to enhance its market share and strengthen its outreach, Dunlop South Africa gets a new warehouse in Cato Manor, Durban.

The company has acquired a property of 12,500 square meter in Cato Manor, which will serve both as warehouse and distribution centre for the business in South Africa. According to SRSA CEO Riaz Haffejee this change from the earlier location in Umbilo was encouraged by the regular increasing demand into the rest of Africa. The step was also taken by keeping the growth projections anticipated for the supply of tyres to manufacturers within the automotive sector in the region. He further explained that this investment is made after extensive planning to enrich the technology and infrastructure to accommodate the plans and demand for future growth.

The previous location in Sydney Road, Umbilo was occupied for 80 years and the new location is on the periphery of Westville. It is located on the periphery of N3, which is a central location to important aerial nodes and logistics centre, expected to increase the efficiency of company’s distribution operation. The new site is leased to Dunlop by Newlyn Group, a prominent Durban based commercial property developer and leaser.

Earlier, Sumitomo Rubber South Africa (Pty) Ltd (SRSA) has announced USD140 million investment in its South African subsidiary aimed at upgrading the technology being used at its Ladysmith production plant. The company is also modernizing and expanding its warehouse facility in Jet Park, Gauteng, which is scheduled to complete later in this year.

According to a recent report published by TechSci Research, South Africa Tire Market Forecast and Opportunities, 2020” tire market in South Africa is forecast to exhibit a CAGR of over 11% through 2020. Rising per capita income, expanding automotive fleet, increasing automobile exports and continuing launch of new vehicle models in the domestic market, are the major factors driving automotive industry in South Africa. Growth in automotive sector is resulting in increased demand for both OEM and replacement tires. Segment wise, passenger car tires are expected to remain dominant in the market through 2020.

As per TechSci Research, this strategic move taken by the Sumitomo Rubber South Africa (Pty) Ltd (SRSA), is a calculated step taken at the right time for the growth of company. A series of investment done by the parent company clearly exhibits its aim to strengthen its position in country as well as provide better services to its customers.