For profit or the environment?: an analysis of the relationship between the motor vehicle manufacturing industry and the green economy in South Africa

Abstract

Motor vehicle manufacturing plays a key role in the South African economy and in 2015 contributed 7,2% to the GDP of the country but at the same time consumes large amounts of raw materials and discharges various forms of waste into the environment (Lamprecht, 2015). The manufacturing industry, within which motor vehicle production in South Africa is located, has been identified as an industry in which sustainability principles can be pursued in spite of the adverse effects manufacturing processes generally pose for the environment. Sustainability concepts remain largely contested because of various and at times divergent interpretations of what sustainability imperatives entail or mean. However, several studies have suggested that the concept refers to the use of resources in a manner that ensures that societal needs are met on an intergenerational scale, whilst ensuring ecological conservation. Generally, corporations have a production and profit mandate and those within vehicle manufacturing are not exempt from this mandate. Despite the variations in the understanding and application of sustainability, the environmental ills and the profit mandate, vehicle manufacturers as part of the manufacturing cohort are expected to facilitate the process of mainstreaming a green agenda in production under the ‘Green Growth Path’ that South Africa has adopted. This is largely because the vehicle manufacturing industries in South Africa yield resources and power that can facilitate a green agenda in production. In the context of this study, the interrelationships have been analysed within the setting of current debates and discussions on the “Green Economy”, profitability and sustainable development with an emphasis on environmental sustainability on a global, international and local scale. Using data collected through case studies conducted within the vehicle manufacturing industry, manufacturers’ sustainability/environmental reports, in depth interviews (with managers, vehicle dealers, Departments of Environmental Affairs and Trade and Industry, oral data, observations and revealed the tensions and conundrums that exist in the manufacturing-green economy relationship. Conundrums exist in that sustainability is ill defined and global companies have redefined sustainability to suit business ultimately controlling decisions by sitting in environmental bodies and influencing decisions to favour business agendas. Contentions arise in instances where environmental considerations interfere with economic interests. The power corporations yield by virtue of their financial muscle, the interpretations of sustainability and the profitability mandate over environmental n concerns is evident in the life cycle of a vehicle from raw material sourcing up until the end of life. Environmental preservation and manufacturing are concepts that therefore are at odds with each other particularly given what they seek to satisfy, but the current drive has been to advocate for harmonious co-existence between production and conservation. The challenges in the relationship between manufacturing and green initiatives stem from an almost insincere or hypocritical approach towards environmental protection adopted by vehicle manufacturers as seen in sustainability reporting, supplier relations and a lack of fair platforms that can be used to address environmental concerns. This is aggravated by an overall lack of political will to address environmental concerns particularly in emerging economies. Corporations are set up with a strong profitability mandate and pursue and promote this mandate and deal aggressively with anything that hinders financial gain and this is evident in the way in which the adoption of green initiatives is explained in line with cost reductions, innovation, growth potential, potential savings, reputation protection or competitive advantage. The suggested recommendations include reviewing the meanings attached to sustainability in relation to manufacturing to ensure preservation is not anchored on the business case for sustainability. In addition manufacturers should also focus on the total effects raw materials’ extraction has on the environment and not just concentrate on the production sites. This can also feed into aspects of sustainability reporting to ensure it is not conducted solely to fulfill legal requirements or as a marketing tool but as a platform to create viable solutions. The strengthening of the political framework will also help in controlling manufacturers’ capture of the greening dialogue and restructuring CSR activities to give back into the environment from which the raw materials are derived from. Further research can be conducted to explore the sustainability-manufacturing link and the complexities that arise in setting up manufacturing as the main area for greening the economy. Building on this, more work can be conducted on teasing out the vested interests that hinder the greening process emanating from various sources such as global companies, local and host environment aspiration to cite a few. Finally, as raw materials are central in production, tracing raw materials from source together with waste generated at every value addition stage up to the production site until disposal of the manufactured component at end of life would give insights into the components that pose the most threat on the environment and these can then be used as a basis to develop less harmful and more viable alternatives