Coega IDZ based gas company Air Products is notching up heavyweight clients on the back of its decision to establish a state-of-the-art air separation unit in the Coega Industrial Development Zone (IDZ), by securing Chinese automotive giant, First Automobile Works (FAW).
In September 2013, Air Products won the national contract to supply APM Terminals with welding gases at their Johannesburg, Cape Town, Durban and Port Elizabeth sites. Air Products believes the new contracts are due to their commitment to service excellence, quality of their product and the advantage of “being neighbours”.
“The market research that led to our decision to locate in the Coega IDZ and Eastern Cape is proving true as Air Products’ starts entrenching itself in both new and established markets,” says Mike Hellyar, Air Products’ Managing Director.
“Our presence at Coega has cemented our total national offering and is yielding interest across trade and industry particularly in Port Elizabeth, and specifically within the Coega IDZ, where we are able to maximize the internal supply chain. Coega is built on an industrial cluster model which encourages seamless supply chain integration. We are already benefiting from this – the FAW and APM Terminals contracts are prime examples of how well this approach is working.”
FAW Port Elizabeth project manager, Dan Jordan, says the company is particularly impressed with Air Products’ ability to provide specialised and customised product solutions to suit their requirements, as well as a total engineering solution for supply, storage and use.
“In Chinese proverbs they say, ‘a good neighbour is much better than a far relative’. Air Products are strategic neighbours and so we consider them as the preferred suppliers to FAW,” said Jordan adding that the deal clincher was the short distance from the source, convenient and in-time delivery, and the fact that Air Products’ full array of welding material and tools will assist FAW in achieving delivery stability for its clients and the African market.
Air Products will supply FAW with all industrial and welding gases needed in the various processes of truck assembly and will be phased in incrementally to accommodate supply needs anticipated in the future.
All indications are that FAW will expand their Coega plant to include production of light passenger vehicles in the future. “This signals market growth for us and is perfectly in line with our projections of a growing industrial hub in Nelson Mandela Bay coming to fruition,” adds Hellyar.
Furthermore, Air Products is showing that it is able to ensure security of supply to meet the standards of international investors.
“We have partnered with Air Products already and are commencing with orders and deliveries,” said Jordan, adding that FAW uses gas in welding automotive components.
Air Products emphasized the downstream job opportunities that would be created through its stable supply to both FAW and APM Terminals.
“Our objective is to make an impact in the Eastern Cape region, both from an industrial perspective, but also a socio-economic one. The long-term viability of the province is dependent on bold investment and action, which we have unhesitatingly taken. In addition, FAW intends creating hundreds of jobs within Nelson Mandela Bay, expanding its operations and thereby growing the local supply chain – which invariably means jobs,” says Hellyar. “We are set to become an integral part of that.”
APM Terminals is also making use of Air Products’ regional and national services. The company offers shipping lines and cargo owners a full range of services for dry and reefer containers, which includes landside services such as repairs, handling, storage, monitoring and container conversion making use of industrial gas to cut and repair damaged parts of containers.
“We chose Air Products because of their promise to deliver service with a difference and their thorough understanding of our business and needs. We are excited by the possibilities of a fruitful business partnership,” says APM Terminals depot manager, Jason Govender. “We are reliant on gas for all our operations and stable supply is critical – which is exactly what Air Products offers us.”
Currently construction is well-underway in Zone 3 of the Coega IDZ with the R300-million Air Products ASU (air separation unit) expected to come online in the third quarter of 2014.
Alan Straton
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