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Tasked with supporting black-owned businesses in the automotive supply chain, the B-BBEE Initiatives Trust established by Volkswagen Group South Africa (VWSA) played a crucial role in helping various businesses navigate and weather the impact of Covid-19.

The Trust was formed by VWSA in 2016 with the mandate of driving transformation in the South African automotive industry by investing in black-owned suppliers and offering post-investment support to these companies. Since its establishment, the Trust has added five businesses to its portfolio and invested a total of R76,5 million in support of these businesses.

Due to the impact of Covid-19 and the national lockdown, the Trust’s priorities for 2020 were aimed at helping these businesses through unexpected economic challenges. The first step was to assess the operational and financial impact of the pandemic on each business, and then implementing measures such as loan repayment moratoriums and specialist resources to mitigate these challenges. Despite the challenges they faced, all of the businesses showed resilience and remained operational, with no significant job losses reported.

For at least one of the businesses supported by the Trust, KPL Die Casting, the support from VWSA was “a huge help” – before and during the pandemic. “With the funding we’ve received from the Trust we’ve been able to buy machinery that ultimately allowed us to save money, as we can now melt and re-use our scrap materials,” explained owner Sally Marengo. “When we were faced with Covid-19, we took charge of the finances and had daily meetings with our Chief Financial Officer, and we pulled through.”

KPL Die Casting was initially a beneficiary of VWSA’s Project Ntinga, but has gained invaluable guidance from the Trust in developing their company as a potential automotive supplier. “I’ve gained a lot of pride and confidence in the business through our interaction with the Trust and with VWSA,” said Marengo. “Their support is handholding, but not a hand-out; the Trust has been a sounding board for me which I believe would benefit a lot of small businesses like ours. It has been absolutely amazing and we have made good strides.”

“Transformation remains a key priority in the automotive industry, but through the Trust we have endeavoured to play an active role in transformation by continuously supporting the companies we’ve invested in,” said Nonkqubela Maliza, Director of Corporate and Government Affairs at VWSA. “I am proud that the Trust and VWSA have been able to continue this work throughout the uncertainty brought on by the Covid-19 pandemic. It is our goal to continue to develop black-owned businesses in the automotive value chain, to the benefit of the industry and the community.”