Death of South Africa’s first smartphone factory

Described as once being a “beacon of African innovation”, South Africa’s first smartphone factory has been stripped and sold, with its machinery liquidated for a fraction of its value.

Opened in October 2019, the Mara Phones factory in KwaZulu-Natal was the result of a R1.5-billion investment by the manufacturer with support from the South African government.

The company, established to assemble high-quality devices at affordable prices for the South African public, unveiled two smartphones — the Mara X and Mara Z — at the opening.

The devices promised long-lasting batteries, high internal storage capacity, and compatibility with Android One, meaning they were guaranteed to receive Android updates for two years.

Regarding pricing, the company said the Mara X would cost R2,999, while the higher-specced Mara Z would cost R3,999.

The company also produced a lower-spec Mara S device, which was 3G-only, while the two higher-spec phones support 4G connectivity.

Mara claimed that KwaZulu-Natal plant could assemble 1.2 million smartphones for the domestic and regional market.

“Korea has Samsung, China has Huawei & Tecno, USA has Apple, and now Africa has Mara Phones!” said Mara Group founder and former Mara Phones CEO, Ashish J. Thakkar.

The company also revealed plans to launch physical experience stores across South Africa.

Mara Phones said its investment in South Africa had already created nearly 200 jobs by the factory’s opening, of which 60% were women and over 90% were skilled, unemployed youth.

“Mara Phones South Africa is expected to generate about 1,500 direct jobs over a period of six years and thousands of indirect jobs, which will contribute to the reduction in unemployment and enhance the transfer of high-tech knowledge in South Africa,” it said.

However, the factory wasn’t in operation long enough for this level of job creation to be realised.

The KwaZulu-Natal plant was put up for auction just over two years after it opened.

R1.5-billion down the drain

In February 2022, Mara Phones’ founders demanded the sale of the KwaZulu-Natal factory in an attempt to salvage what they could from the facility.

Auction documents revealed that the plant and its contents were being sold as a single unit.

The auction lot included the plant, its manufacturing and testing equipment, smartphone components, and assembled devices sitting in storage.

“The line is in very good condition and could be reworked to make other electronic components,” the auctioneers said.

Thakkar described the company’s ambitious plan to launch a smartphone factory in South Africa as “untenable” due to the Covid-19 pandemic and lockdowns four months after its launch.

“Unfortunately, the lack of uptake in the South African domestic market, coupled with a shortfall in tender materialisation and lockdowns, has prompted this course of action,” Mara’s executives said.

“As in other countries, the pandemic really affected South Africa and our business as a result, too.”

The company didn’t comment on its plans for the Mara Phones Experience Store, which it opened in Maponya Mall, Soweto, in November 2020.

Reports at the time indicated that the store’s employees were unaware that the factory was being shut down.

They could not offer customers repair services, did not know where their new stock would come from, or whether the store would stay open.

Its closure came despite Mara Phones receiving a R101.3-million tax break in February 2020 for qualifying as a so-called “Greenfield project”.

The company had also received the status of a preferred brand in the South African government’s RT15-2021 communications contract.

This forced various state institutions to give preference to Mara smartphones over rivals like Samsung and Huawei.

The South African plant’s performance was in stark contrast to the Mara Phones factory in Rwanda, which was still performing well after opening around the same time in October 2019.