SKF AB (Sweden; Stockholm: SKFB) announced it will close its plant in Uitenhage, South Africa. Uitenhage is SKF's only manufacturing facility in South Africa.

The company cited problematic economics: virtually all of the raw materials used at Uitenhage must be imported, but more than 90% of the plant's production is exported. Also, it produces single-row and double-row ball bearings, which are highly cost-sensitive and price-sensitive. Finally, the continued strength of the South African rand in foreign exchange markets makes the plant's production even less competitive in the world market.

As a result, Uitenhage is not cost competitive in its home market or in export markets. SKF said it has tried various growth and productivity initiatives, but to no avail.

SKF has had a presence in Africa since 1914. Established in 1964, Uitenhage currently employs 134 workers. It will be shuttered by the end of June 2007.

Uitenhage's production capacity, in excess of 10 million bearings per year, will shift to facilities in other countries.