Gibela’s giant footprint: ending SA’s 40 years in train manufacturing ‘wilderness’

Developing a robust, sustainable local supplier base

South Africa’s 40-odd year gap when it comes to train-building technology is about to close as the Gibela Rail Transport Consortium (Gibela) gears up to start the construction of its R1 billion, 85 000m² factory complex at Dunnottar in Ekurhuleni, Gauteng.

Construction is scheduled to start in the third quarter of this year.

When the factory is completed and comes into production, building trains at a hitherto unheard of peak rate of 62 trains a year, South Africa will have taken a very visible and significant leap into the world of high-tech train manufacturing.

The ramifications of what the Gibela-PRASA nexus means for South Africa are extensive as this project will, in keeping with PRASA’s mandate, help restore the viability of South Africa’s commuter rail system.

Gibela’s R51 billion contract to supply PRASA with 600 new trains over 10 years is only one part of the whole. South Africa will also benefit from a contract that seamlessly incorporates skills and technology transfer from Gibela’s French parent company, Alstom, with local sourcing of a range of specialised components that will combine to contribute to South Africa’s industrial renaissance.

In a contract this size and duration, transparency lies at the heart of all Gibela’s business interactions.

Gibela’s CEO Marc Granger insists that “this is a non-negotiable for the company – suppliers, and indeed all stakeholders, need to gauge demand and capacity before committing to playing their part in restoring South Africa’s rail industry. Developing a sustainable industry takes time and Gibela knows that facing challenges head-on and openly is critical to the project.”

Creating sustainable jobs and developing South African skills

Trains are built by people. That is the mantra of Gibela and Alstom.

When it is up and running, the Dunnottar facility will provide employment for at least 1 500 people, the majority of whom will be skilled artisans. The recruitment process is at an advanced planning stage for permanent positions, with clear career paths for those selected. There are likely to be many more applicants than positions available, and the selection process will be demanding. Preference will be given to those who have academic qualifications as well as artisanal skills. Most of those recruited will be drawn from the areas adjacent to the manufacturing facility but in consideration of the scarcity of the required skills the net will be cast wider across provincial confines. It is, however, worthy to note that opportunities exist in the Gibela contract for the training, of those who are not qualified, in various rail-related skills for possible jobs in the rail industry.

At the outset, artisans possessing a range of skills, including leadership, will be selected for intensive training at Alstom’s Brazilian facility where the first 20 of the PRASA trains are currently being manufactured in a move calculated to enable such training ahead of the start of the South African manufacturing programme. It is training that will not only hone the artisans’ own skills but that will also provide them with the ability to pass on their skills to their colleagues back in South Africa on their return.

More than 20 Gibela employees, the majority of whom are engineers, are already in France, Italy, Belgium and Brazil where they are receiving a cross-section of advanced skills that will be critical in supporting a manufacturing rate that will, according to Granger, “test the abilities of the most experienced and large original equipment manufacturer at its best manufacturing unit.” This group, too, will be returning to South Africa, ready to pass on the skills they have acquired to their colleagues as Gibela ramps up from the current staff complement of 112 to 350 by the end of the company’s March 2016 financial year.

Local sourcing

Local sourcing is not simply a question of buying local products off the shelf. Parts and components needed to build the modern PRASA trains will themselves be state of the art. This means a special relationship with new and established South African suppliers – not only those who will occupy premises at the Dunnottar factory site but also others further afield. A robust, sustainable local supplier base needs to be developed to achieve the company’s 65% local content obligations.

The foundations towards the strengthening of ties with local suppliers are being established – Gibela’s Supplier Development team has been interacting with local suppliers to leverage the company’s expertise and that of Alstom to equip them with capabilities to be competitive and to manufacture at the required rate and quality. It is through these relationships and the transparent exchange of information that challenges such as lack of industrialisation and industrial capacity shortages can be overcome and the supply of long-lead items (on time, on budget and in the right quantities) assured.

Several successes have already been recorded and critical to these is capacity-building, which is resulting in win-win solutions for Gibela and its suppliers and most importantly, their access to export markets.

Progress with the Brazilian manufacturing programme (first batch of only 20 trains)

The Brazilian manufacturing programme for the first 20 trains has advanced to an extent where the first train with its six cars is in the testing phase and well on course for shipment to South Africa in September ahead of on-shore delivery in November. All six cars of train number two are in the fitting phase and the production flow for the rest is on track. “We are pleased with the progress made and our Brazilian colleagues are now getting ready to welcome South African artisans and to not only impart skills but also benefit from language and cross-cultural exchanges,” says Granger.

For more information please contact:

On behalf of Gibela:

Russell and Associates:

GIBELA 2014. All rights reserved. Information contained in this document is indicative only. No representation or warranty is given or should be relied on that it is complete or correct or will apply to any particular project. This will depend on the technical and commercial circumstances. It is provided without liability and is subject to change without notice. Reproduction, use or disclosure to third parties, without express written authority, is strictly prohibited.