EFF, SMG & BMW: Three peas in a pod

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Photo by Torsten Dettlaff

What the Oppenheimers’ are to mining in South Africa and the Ruperts are to tobacco and industry, the McCarthys are to our country’s motor retailing industry. The family business thrived under apartheid, ownership of The SMG remains White and continues to ensure its monopoly over the industry. 

It is therefore unfathomable why the Economic Freedom Fighters would have capitulated and given in to signing an agreement with The SMG even before the group’s alleged institutional racism was exposed.

Justin McCarthy, founder of the McCarthy name in automotive retail, worked for Fisher, Simmons & Rodway as an accounting clerk. When he joined the company is unclear. The SMG on their website says 1910 and Bidvest McCarthy says 1921. What is certain though is that by 1936, McCarthy could register McCarthy Rodway Limited on the London Stock Exchange and on the JSE a year later. 

According to the Bidvest McCarthy site, the group initially focused on automotive distribution and soon cemented a relationship with Toyota. By this time, according to The SMG site, Justin McCarthy had been succeeded by his son in the business, Brian McCarthy, and McCarthy’s developed into the “most trusted name in South African motoring and the biggest motor retailer in the Southern Hemisphere [sic].”

Seemingly, Sean McCarthy, son of Brian and grandson of Justin, wanted to maintain the family business, its independence and as a result, in 2003, broke away from McCarthy Retail Limited to found The Sean McCarthy Group (SMG) whereas Bidvest bought McCarthy for R967 million on 1 January 2004. 

Yet like most white companies founded and which thrived under apartheid South Africa, The SMG has been plagued with allegations of institutional racism. In 2010, Ayanda Dlamini laid a complaint against Erich Tonsing, who managed the SMG’s Durban Approval Repair Centre, alleging that he called her a baboon. The matter was eventually settled outside the equality court as conspicuously as the EFF’s agreement with SMG last week.  

According to the party’s Western Cape provincial chairperson, Melikhaya Xego, the EFF accepted SMG’s version of events that the advert for a white male job vacancy was not issued by SMG even though the email from Julian Schlemmer, of Schlemmer & Associates, clearly stated that the specifications for the job came “from SMG for a Marketing Manager.”

Seemingly, BMW South Africa has also accepted SMG’s version of events, with Diederik Reitsma, General Manager: Group Communications for the BMW Group South Africa & Sub-Saharan Africa, stating in an email, that “the SMG Group…feels victimised and explores [sic] all options and legal remedies available, as their reputation is harmed. We cannot go into further details, as the matter is under judicial consideration. SMG Group naturally has decided to end any form of business with the recruitment agency with immediate effect…” 

The legal action against Schlemmer & Associates by the SMG, as stated by Reitsma in an email to me, would certainly help the SMG brand gain some repair but we have yet to hear about this legal action by SMG against Schlemmer from SMG.

However, what we have also discovered is that Tim Abbott, BMW South Africa’s CEO, enjoys a rather professionally questionable relationship with the McCarthys. There are suggestions and pictures of Abbott on the McCarthy farm and that they socialise quite regularly together. 

Abbott, on social media, openly wears SMG paraphernalia thereby giving a deliberate endorsement of one franchisee over another and some have even suggested that SMG’s BMW dealerships have grown exponentially since Abbott’s ascendancy to BMW South Africa’s CEO.

The EFF’s abandonment of the fight against alleged racism at SMG, clearly a monopoly player in South Africa’s automotive retailing industry, has probably served as comfort to the Black board members of BMW South Africa which we have not heard a word from. Surely, the rest of us should ask whether tokenism in South African corporate has become this entrenched. 

Apart from the racism, the unprofessional relationship that is enjoyed between Abbott and the McCarthys goes unchallenged, especially by Abbott’s colleagues at BMW. One shudders to think that Abbott being a British national has anything to do with the flagrancy of his relationship with The SMG and the protection that he enjoys at BMW.

While we are quick to make a loud noise about corruption in South Africa, it seems we are retarded in fighting racism in the private sector. Corporate leaders are allowed to cover for each other while their respective businesses grow. 

As South Africans we must ask why our vocal champions against racism in South Africa, the EFF, are selective in which businesses they go all out to shut down, such as Clicks when TRESemmé was the real culprit, and others, such as The SMG and BMW South Africa, can get off the hook so easily. Yet while we figure this out, the Oppenheimer, Rupert and McCarthy empires continue to grow unabated. 

Dr Wesley Seale taught South Africa politics at Rhodes University and the University of the Western Cape. Pictures supplied are from Instagram and Facebook.