BMW 'ditches strike prone S.Africa for new car'

Johannesburg (AFP) - German automaker BMW has confirmed that labour instability in South Africa has cost the country a chance of producing a new car model, media reported on Friday.

Business Day newspaper said the decision was confirmed by BMW South Africa boss Bodo Donauer during a meeting with Trade and Industry Minister Rob Davies.

A joint statement said Donauer had stated "it was a matter of fact that lengthy strike action ... had cost BMW SA an opportunity to compete for a potential second model."

The firm was not planning to disinvest from the country, it said.

The company currently produces 3-Series sedans at its plant in Rosslyn, north of the capital Pretoria. The vehicles are exported to countries such as the US, Australia, and Hong Kong.

The facility was shut down by weeks of strike action which caused the company to lose production of 13,000 vehicles.

BMW said the strikes, which hit other major car manufacturers, affected South Africa's reputation to be reliable partner for export. Workers returned to work on Monday.

Davies is expected to meet with car companies next week to discuss their concerns.

Manufacturers in South Africa include Volkswagen, Toyota, Ford and General Motors.

Meanwhile, the National Union of Metalworkers of South Africa dismissed BMW's action as tantamount to "political and economic blackmail."

The Retail Motor Industry Organisation said the strikes reduced vehicle exports by 75 percent last month.