JOHANNESBURG -- South Africa's automakers have concluded a three-year wage agreement with the union representing 21,000 workers, said representatives of the industry and the union on Wednesday.
"The deal sets an average pay rise of 7.5 percent, representing a real wage hike for workers in the vehicle manufacturing industry," The National Union of Metalworkers of South Africa's (NUMSA) spokesman, Dumisa Ntuli, said in a statement.
NUMSA had threatened to go on strike after failing to reach an agreement on wage increases with the Automobile Manufacturers Employers Association.
The union had demanded a 9 percent across-the-board increase, while employers offered 6.5 percent. South Africa's central bank is targeting an inflation rate of between 3 percent and 6 percent.
"We were able to seal the deal without any conflict for the first time in the history of the industry," Ntuli said.
South Africa's automakers have won several contracts for the export market and account for 12.8 percent of the country's total exports. The unions have traditionally used such multi-billion rand contracts to pressure employers to agree to their demands.
The association's members include BMW South Africa, DaimlerChrysler South Africa, Ford Motor Company of Southern Africa, General Motors South Africa, Nissan South Africa and Volkswagen South Africa.
"Everyone one will now focus on making cars, and we look forward to a period of stability with no industrial action for the period of the agreement," said Dave Kirby, spreaking for the industry association.