Automotive Investment Scheme
The Automotive Investment Scheme (AIS) is an incentive designed to grow and develop the automotive sector through investment in new and replacement models and components that will increase plant production volumes, sustain employment and strengthen the automotive value chain.
Benefits
The scheme provides for a non-taxable cash grant of 20% of the value of qualifying investment in productive assets and 25% of the value of qualifying investment in productive assets by component manufactures and tooling companies as approved by the Department of Trade, Industry and Competition.
An additional non-taxable cash grant of 5% may be made available for projects that maintain their base year employment figure throughout the incentive period, and achieve at least two of the following economic requirements:
- Tooling;
- Research and development in South Africa;
- Employment creation;
- Strengthening of the automotive value chain;
- Value addition; and
- Empowerment.
To qualify for an additional grant of 5% (cumulative 10%), the project must demonstrate the following:
- In respect of light motor vehicle manufacturer: a specified increase in unit production per plant; and
- In respect of component manufacturers: a specified increase in turnover and manufacturing of components that are currently not being manufactured in South Africa.
Who can apply
- Light motor vehicle manufacturers that have achieved, or can demonstrate that they will achieve, a minimum of 50 000 annual units of production per plant, within a period of three years; or
Component manufacturers that are part of the original equipment manufacturer (OEM) supply chain or who will achieve at least 25% of total entity turnover or R10-million by the end of the first full year of commercial production as part of a light motor vehicle manufacturer supply chain, locally and internationally.
A sub-section of AIS are the incentives offered to medium- and heavy-commercial vehicles.
Benefits
The scheme provides for a non-taxable cash grant of 20% of the value of qualifying investment in productive assets by medium and heavy commercial vehicle manufacturers.
It also provides for a non-taxable cash grant of 25% of the value of qualifying investment in productive assets by component manufacturers and tooling companies.
Who can apply
- Truck manufacturers
- Bus chassis manufacturers
- Component manufacturers, deemed component manufacturers, tooling companies and bus and truck body manufacturers
You can find out more here, including guidelines and application forms.