Nelson Mandela Bay mayor Babalwa Lobishe says power dips affecting industrial areas are being caused by companies using more electricity than they have declared.
She made the statement at a Korsten automotive supplier, where disruptions can cost the company up to R75,000 a day to keep production running.
Lobishe said the metro had sufficient electricity supply but that some companies applied for lower capacity and then used more electricity than declared.
The Nelson Mandela Bay Business Chamber said in March it had recorded 203 unplanned outages in key industrial and commercial areas since January 2023.
In May, the municipality said more than 1,100 faults were affecting its low-voltage cable and overhead-line networks.
“Companies would ask for a lower voltage and then utilise more, so it then trips the system,” Lobishe said.
“In terms of our own supply as the municipality, we have sufficient.”
Lobishe was speaking at Acoustex Trim, a black-owned Tier 1 automotive supplier in Korsten.
Small business development minister Stella Ndabeni-Abrahams toured the facility on Tuesday before hosting an automotive-sector business breakfast at the Boardwalk International Convention Centre.
Acoustex Trim commercial director Andre Swartbooi said the company’s monthly electricity bill was between R700,000 and R900,000, while power disruptions damaged products, halted production and drove up operating costs.
The company produces sound-deadening and acoustic-insulation components for vehicle programmes linked to Volkswagen, Isuzu, BMW, Ford, Toyota and Nissan, with products reaching international markets through vehicles exported from SA.
Swartbooi said the visit was an opportunity to showcase a black-owned supplier operating from Korsten in a sector often dominated by larger companies.
“We are a black supplier, we are in Korsten, and it is not a place where everybody would come to because people go to the bigger establishments, the multinationals and all of that,” he said.
“We are a proud Tier 1 BEE supplier, and we want to showcase to her what we do because the products that come out of here are for export worldwide.”
But he said smaller black-owned suppliers faced steep barriers in the automotive sector, including the cost of quality certification, startup finance, rising fuel and raw-material costs, electricity tariffs, power dips and outages.
“We need that protection from government for smaller suppliers to grow,” he said.
“Our electricity bill is quite significant. It is from R700,000 to R900,000 every month.”
Swartbooi said the plant used substantial heating in its manufacturing process.
When power failed, material hardened and had to be reheated, while parts could be damaged if production stopped midway.
“When I press the stop midway, it damages the parts completely, so we have rejects that we need to throw away,” he said.
The company had invested in a generator capable of running the entire plant, but Swartbooi said the backup came at a major cost.
“That in itself is very expensive. That could be R75,000 a day to run this plant, and we have one or two power dips a month,” he said.
Lobishe’s comments come against a backdrop of mounting concern from organised business over the reliability of the metro’s electricity network.
However, she said the municipality was analysing the electricity needs of affected industrial areas and that no industry had been highly affected by such problems in the past six months.
Meanwhile, Ndabeni said her department was working with original equipment manufacturers, the municipality and other stakeholders on interventions to protect industrial operations.
“We will detail the interventions on the electricity side but we are working with OEMs specifically to ensure that industrial sites are protected,” she said.
“We will have them again with the mayor and the municipality themselves to say how we make sure that at least during those hours of operation they are protected.”
She said electricity costs were suppressing the growth of small businesses and that the government had to consider incentives for firms supporting smaller suppliers and jobs.
The breakfast formed part of the government’s One National Plan for the Micro, Small and Medium Enterprise Ecosystem, which seeks to align policies, funding and support programmes for small businesses.
Eastern Cape economic development, environmental affairs and tourism MEC Nonkqubela Pieters said the city’s automotive industry formed part of SA’s industrial heritage, with roots stretching back more than a century to the establishment of an assembly plant in 1924.
She said the automotive ecosystem, including Isuzu, Ford, Volkswagen and Mercedes-Benz South Africa, had both an advantage and a responsibility to use that industrial legacy as a platform for the next generation of manufacturing.
“The next phase of industrialisation cannot be built through isolated interventions,” Pieters said.
“The focus must be on practical co-ordination around sector priorities, implementation accountability and measurable outcomes.”
At the breakfast, National African Federated Chamber of Commerce and Industry representative Mpilontle Ndlaleni said small businesses were being excluded from programmes intended to assist them.
“There are programmes for SMME development but the challenge is that those entities are not collaborating,” he said.
“You come up with these brilliant programmes but us people who are supposed to benefit, we are not getting anything.”
Ndlaleni alleged that some officials tasked with implementing SMME programmes were competing with the businesses they were meant to support.
Ndabeni-Abrahams urged businesses to report any such allegations so they could be investigated.
The automotive sector also raised concerns about access to bank funding.
Nelson Mandela University and Port Elizabeth TVET College representatives called for greater support for final-year automotive and design students, including project funding and help securing host employers.
Lobishe said the metro had invested R17m over three years to support the automotive sector and was prioritising road refurbishment and pothole maintenance at its 11 economic nodes, with R60m allocated in the current financial year.
“We started straight in Perseverance and M19, making sure that anything that goes from the harbour to the industrial areas is safe on the road,” she said.
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