New AfCFTA Rules Boost African Automotive Trade

The African Association of Automotive Manufacturers (AAAM) has described the approval of new trade rules for the automotive sector under the African Continental Free Trade Area (AfCFTA) as a major step forward for industrialisation on the continent.

The decision, formalised during the 39th Ordinary Session of the Assembly of African Union Heads of State and Government, paves the way for duty-free trade in vehicles and components across member states.

The Rules of Origin (RoO) for automotive products, which apply to customs codes 8701 to 8716, were initially agreed upon by ministers at the AfCFTA Council of Ministers meeting in Cairo in September 2025. The formal endorsement came from heads of state during their gathering in Addis Ababa, Ethiopia, recently.

Under the newly adopted framework, vehicles and components must contain at least 40% local content to qualify for preferential trade terms under the AfCFTA. This means up to 60% of materials may be sourced from outside the continent without affecting the product’s eligibility to be traded as ‘Made in Africa’. The arrangement includes a review clause after five years and is intended as an interim measure to encourage local manufacturing and value addition.

Victoria Backhaus-Jerling

Victoria Backhaus-Jerling, Chief Executive Officer of AAAM, said the agreement provides clarity that has long been needed by industry players. “For the first time, we have a clear and harmonised definition of what it means for a vehicle to be considered ‘Made in Africa’. This kind of certainty is what investors look for. It supports the development of regional supply chains and aligns with the broader goals of the AfCFTA Automotive Strategy.”

Wamkele Mene, Secretary-General of the AfCFTA Secretariat, noted the new rules offer legal predictability for manufacturers considering local production. “This approval gives the industry the assurance needed to invest in local assembly and component manufacturing. We encourage the private sector to build on this momentum and work with all stakeholders to ensure inclusive growth across the African automotive value chain.”

AAAM has been closely involved in the development of the framework, working alongside the AfCFTA Secretariat, Afreximbank, and various government bodies to shape rules that support local content development and job creation.

Martina Biene

Martina Biene, President of AAAM, highlighted the cooperative effort behind the milestone. “This achievement reflects what can be done when public and private sectors work together. The framework enables African countries to trade more competitively among themselves and lays the groundwork for the continent to become a more serious participant in global automotive markets.”

With the rules now in place, countries that have committed to immediate or phased tariff liberalisation under AfCFTA categories A and B will be able to begin preferential trade in automotive goods. The move is expected to support the growth of local assembly and component manufacturing, and over time, give African consumers access to more affordable vehicles produced within the continent.

https://bit.ly/4qM9HkR

Andrew Kirby Sounds Alarm on SA Motor Industry's Decline

Andrew Kirby did not mince words when he talked about South Africa’s motor industry. He described a sector losing ground—local content is dropping quickly, exports are too dependent on Europe, and while the world races toward electric vehicles, South Africa’s barely off the line.

Andrew Kirby

Honestly, it was the bluntest industry review anyone has made in years. Kirby, president and CEO of Toyota South Africa Motors, recently presented the 2026 State of the Motor Industry address and skipped the usual talk about resilience or market share. Instead, he pointed directly at the cracks in one of South Africa’s last big manufacturing pillars.

He did not soften the numbers. Right now, only a third of cars sold in South Africa are built here. In 2006, it was 56%. The decline is speeding up. Kirby’s outlook for 2026? Even worse.

“We really lack scale in South Africa,” he said. He meant more than just production numbers—he pointed to the country’s population, limited public transport and basic mobility needs. “We should be much bigger than this.”

Last year’s headline—600 000 vehicles sold—sounds impressive if you do not look deeper. But Kirby did. Take away the increase in cheap, entry-level cars and there is hardly any actual value growth.

“It’s not all that it seems,” he cautioned.

Toyota's manufacturing facility in Prospecton near Durban

Exports look good on paper—609 000 vehicles produced last year, 411 000 exported. That is 68% of local output, mostly to the UK and EU. At first glance, it seems like a win. Look closer, and it is a vulnerability.

Eighty-one percent of those exports go to Europe and the UK. Africa, once important, now only takes 8%. The continent is flooded with used imports and cheap new cars from the Middle East, so private buyers barely count. Most sales rely on government fleets.

“We can’t just shrug and say we’ll export everything to Europe,” Kirby said. “Because those 400 000 exports? That is going to change.”

Regulations are moving quickly. The UK wants zero-emission vehicles, Europe is tightening emissions rules, and every new regulation makes it harder for South Africa to keep up (even with US President Donald Trump removing carbon restrictions).

Temporary extensions for hybrids or low-carbon steel do not fix the issue; they just show how unstable the electric vehicle sector still is. That uncertainty makes long-term planning impossible.

“In the next five years, we’re going to see a big drop in exports to Europe and the UK,” Kirby warned.

South Africa simply does not have a competitive electric vehicle industry yet. The few new energy vehicles sold locally are not made with local parts. No scale, no localisation. No localisation, no cost advantage. It is a loop South Africa cannot escape—and time’s running out.

Kirby’s strongest point came when he spoke about real value addition. That is the core of any manufacturing sector. In 2000, South Africa’s auto manufacturing value was $720 per person. Now? It has dropped to $614. Not only no growth, but a step backwards.

“We’re de-industrialising too soon,” he said. “Are we seeing the first signs of that in auto?”

He mentioned Vietnam—and not by chance. Smart policy has let Vietnam surge ahead, while South Africa has lost advantage after advantage. Electricity is costly, even with improved loadshedding. Wages rise faster than inflation. Water is now a concern—Toyota had to build its own dam to keep operating. Logistics, especially rail, remain expensive, even after port improvements.

Production at the Toyota factory in South Africa

The entire supply chain is under strain. Steel, tyres, the network of component makers built up over decades—all are feeling the pressure.

“We’re lucky we spent 100 years building this manufacturing base,” Kirby said. “If we lost it now and tried to restart in 2026, it wouldn’t happen.”

Right now, the industry needs a serious, honest discussion about policy—before it is too late.

Kirby made one thing clear—he is not looking for quick fixes or dramatic interventions. That is not the point. What he is after is harder: a smart, well-run industrial policy. One that understands the difference between a healthy import market and replacing imports just for the sake of it.

“To be honest, the country just can’t afford that,” he said, referring to heavy-handed import substitution. “The foreign exchange hit is massive, and it’s something we often overlook.”

His argument? Instead of sweeping changes, he is calling for targeted, incremental adjustments to strengthen competitiveness without blowing the budget. The aim: raise local content back up to 40%-50%. Not by hiding behind tariffs, but through timely policies that recognize imports are necessary, though over-reliance carries risks.

He was equally blunt about new energy vehicles. South Africa does not have the option to say the transition is unaffordable.

“If we say we cannot make the shift, we are giving up on exports as well. All we will have left is making outdated tech for a shrinking market,” Kirby said. “That’s just not the way South Africa has operated over the past hundred years.”

Toyota’s strategy sums it up—they are investing in multiple technologies: hybrids, plug-in hybrids, battery electrics, fuel cells, even carbon-neutral hydrogen engines. There is no single solution, and in South Africa, hybrids will dominate for years. But the issue is clear: only 4% of new energy vehicles sold locally are built here. That gap is right in front of us.

This is not a promise—it is a possibility

The bz4x will be the first electric model launched in South Africa by Toyota

Kirby sees a real opportunity. With the right policies—now, not next year—the local market could surpass 700 000 units. Manufacturing could reach 720 000. That would mean R21-billion more in value and 14 500 new jobs, not counting the broader impact.

“Our planning window is three to four years,” he said. “We are already investing, and to be honest, we are running behind. If we can get this sorted by 2026, it will decide our investments for 2029 and 2030.”

He did not state the warning outright, but it is clear. Other countries are securing investment through clearer strategies and more stable policies. South Africa is competing for those same opportunities, but it is a tough race.

Still, Kirby sees something positive—a genuine, open dialogue between government, labour, and the industry group, naamsa. People are speaking honestly. But talking is not policy.

“We need to act. Now,” he said.

Compete, do not collapse!

Goolam Ballim, Standard Bank’s Chief Economist, set out the bigger picture. The world is not breaking down—it is reorganizing. Alliances, supply chains, the rules of the game—they are all changing. Now, resilience is more important than squeezing out every bit of efficiency.

For South Africa, this shift is both a risk and an opportunity. The old model—relying on a single export market, importing finished vehicles, and exporting most of what we build—is fading. What happens next depends on the decisions we make now.

Kirby’s remarks stood out because he was direct. He identified the problems, put real numbers on what is at stake, and outlined a practical goal. He did not minimize the challenge, but he was clear: the solutions are there if we are ready to move.

“We shouldn’t just ask how to avoid becoming an import replacement market,” he said. “We need to figure out how to build something stronger—to support the circular economy, create jobs, develop skills, and grow a dynamic auto industry and industrial base.”

Now it comes down to this: can policy move quickly enough to match the market? The window is open, but it will not stay open for long.

https://bit.ly/4kITMCG

Afreximbank Membership: Transforming South Africa's Auto Market

In a strategic move poised to reshape the continent’s economic landscape, South Africa’s recent accession as a shareholder of the African Export-Import Bank (Afreximbank) is being heralded as a potential game-changer for its cornerstone auto industry.

Analysts suggest the decision could unlock crucial finance, accelerate the implementation of the African Continental Free Trade Area (AfCFTA), and ultimately steer the sector towards a more prosperous, integrated future.

A US$8-billion commitment: HE Cyril Ramaphosa, President of South Africa and Dr George Elombi, President and Chairman of Afreximbank at the Country’s accession signing ceremony, marking the launch of a major Country Programme engineered to bolster the South African economy

The local automotive industry, a critical pillar of the national economy contributing nearly 5% to GDP and supporting hundreds of thousands of jobs, has long grappled with the challenges of limited scale, fragmented markets, and expensive access to trade finance. Joining Afreximbank directly addresses these pain points.

The most significant potential impact lies in the synergy with the AfCFTA. While the agreement promises a continental market of 1,3-billion people, its rollout has been hampered by logistical hurdles, payment system disparities and a simple lack of trade finance tailored for intra-African commerce.

Afreximbank, a key financial architect of the AfCFTA, operates the Pan-African Payment and Settlement System (PAPSS), which allows for instant cross-border payments in local currencies.

The macroeconomic outlook for local automakers, battered by global supply chain woes and sluggish domestic demand, stands to gain substantially. Increased export volumes into Africa would improve plant utilisation in places like Kariega, East London, and Rosslyn, enhancing economies of scale and potentially making local production more cost-competitive globally.

Furthermore, Afreximbank’s project finance capabilities could attract investment into the critical transition to new energy vehicles, however success hinges on our local industry’s agility to produce vehicles competitively tailored for diverse African consumers and on government’s parallel work to fix our ports, rails and energy supply.

If these domestic challenges are met, the combination of Afreximbank’s financial muscle and the AfCFTA’s market access could transform South Africa from a powerhouse serving mainly its domestic and traditional European export markets into the undisputed automotive hub of Africa.

The journey has begun, and the industry is now watching closely to see how quickly the promised finance flows onto the factory floor and out through the continent’s borders.

More than 2-million VW Polo models have been built at the Kariega plant

As always, there is a ‘but’ and in this case it comes from Volkswagen South Africa.

When Volkswagen Group Africa (VWGA) chairperson and managing director Martina Biene wrote to President Cyril Ramaphosa shortly before Christmas, it was an effort to push urgency into a process she believes has dragged on far too long, with real implications for the future of South Africa’s automotive industry.

Speaking at VW’s annual Media Indaba in Kariega, Biene said: “I wrote a letter to the President prior to Christmas. I mainly outlined that for us at VWGA, this year is crucial for securing an investment decision from VW headquarters for the next project in the pipeline.”

Her request was straightforward: clarity. Not only on the financial viability of future projects, but also on whether South Africa’s policy direction gives investors enough confidence to commit long-term capital.

“For this investment decision, they look at the economics and the business case,” she explained. “But headquarters also look at what’s happening in the country. One of their non-negotiables is seeing improvement in South African policies.

“You might have a business case,” she cautioned, “but there are stronger business cases elsewhere if we can’t show that investing here is sustainable.”

She didn’t mince her words: “This year for us is make or break.”

Professor Adrian Saville, economist and strategy specialist at GIBS, echoed the concern. Asked whether a major manufacturer could realistically leave South Africa, he didn’t hesitate.

“Could a specific business leave? Absolutely. Capital can go anywhere,” he said. “There are 200 markets you can choose to allocate capital to. There’s nothing that guarantees South Africa a place at the front of the queue.”

Saville pointed out that the country’s industrial history is full of once‑significant manufacturers that no longer exist. “South Africa is an industrial graveyard. No company is too big, too established or too important to walk away if conditions deteriorate.”

Despite the seriousness of her message, Biene says she received no direct reply from Ramaphosa. “The unfortunate thing is that the President didn’t reply to me,” she confirmed.

She did note that there has since been activity between the Automotive Business Council (Naamsa) and the Presidency’s staff, suggesting the letter may have prompted some movement behind the scenes.

Whether that translates into actual policy progress remains unclear. “Am I satisfied with that? I don’t know,” she said.

Saville argues that certainty alone isn’t enough if the underlying policy is weak. “Policy certainty over a policy that doesn’t work is a death blow,” he said. “We’ve got a knife at a gunfight.”

Still, both he and Biene acknowledge that South Africa has shown it can get policy right. The Automotive Production and Development Programme and the South African Automotive Masterplan are often cited as examples of what’s possible when government acts decisively.

The challenge, Biene says, is timing. “We don’t have the luxury of two or three years of debating and deliberating. The requirement is urgent.”

Her letter to the President was intended to make that point clear. Whether the message lands will matter not only for Volkswagen, but for the entire vehicle manufacturing sector in South Africa.

https://bit.ly/3MsFyZQ

Growth and Innovation at Isuzu Motors in South Africa

GQEBERHA – Isuzu Motors South Africa used its annual corporate address, held at its Struandale manufacturing plant, to detail its business evolution since 2018 and chart its course for the coming years.

The event, served as a backdrop to discuss the firm's changed structure and market approach.

A central feature of the address was the formal introduction of the Isuzu Corporate Philosophy to the local market. Centered on the purpose statement ‘Moving the World – For You’, the framework outlines the company's approach to creating value for customers, employees and society.

"This philosophy articulates why we exist: to help move people, goods and communities forward in a way that creates lasting value," says Billy Tom, President and Chief Executive Officer of Isuzu Motors South Africa. He emphasised it was a guiding principle, not merely a slogan.

The company linked this philosophy to its local operations, stating it translates into providing reliable mobility solutions, responding to customer needs, and strengthening its role in local economies.

"The organisation today is different from the one we launched eight years ago," he says. "We have transformed our leadership, modernised operations and expanded our product offering, while staying true to our core values."

The address provided figures to illustrate recent market performance. In 2025, the company retailed 26 000 vehicles in South Africa, representing growth of 12,2% from the previous year. Exports to other African markets rose by 4,5% to 5 371 units.

Isuzu maintained its position as the top-selling brand in the combined medium and heavy commercial vehicle segments for a 13th year. Passenger vehicle sales also grew, with D-MAX sales increasing by 11,7% and MU-X volumes rising by 45,4% following the launch of a new model.

"Customers choose Isuzu for reliability, durability and vehicles suited to African conditions," says Craig Uren, Executive Vice President for Revenue Generation. "Our focus is on innovating from that foundation to stay relevant in a changing market."

The company highlighted its ongoing investment in its Eastern Cape manufacturing base, noting its role in regional jobs and skills development. It cited the recent establishment of a R750-million component manufacturing facility by VSL Manufacturing in Struandale, supported by Isuzu, as an example of deepening local supply chains.

Internally, the company reported continued investment in employee development, linking it to four consecutive Top Employer certifications. Community initiatives in water security, education and conservation were also noted.

Looking forward, the company confirmed plans to launch a new D-MAX and next-generation truck range in 2026.

"Amid new product introductions, our commitment endures: to deliver solutions customers can trust, now and in the future," Uren added.

Separately, the company released sales data confirming its continued lead in the commercial vehicle sector. For the period from January 7, 2025 to January 6, 2026, Isuzu held a 26,8% share of the combined medium and heavy commercial vehicle cab-over-chassis market.

"This outcome is based on product strategy, engineering refinement, and a focus on customer operational needs," says Uren. He attributed the sustained performance to factors including total cost of ownership, vehicle durability, aftersales support, and long-term partnerships with clients.

https://bit.ly/3Zh9Di2

Strong growth forecast from UD Trucks and updates to Quester

Against a backdrop of economic pressure and market volatility, UD Trucks Southern Africa is charting a course of confident and stable growth. This is anchored by disciplined execution, solid retail partnerships and a consistent focus on keeping customers' vehicles on the road.

These points were central to the recent UD Trucks 2026 Media Engagement at Zwartkops Raceway under the theme ‘Confident, Stable Growth though Volatile Underneath’.

The operating environment continues to present challenges, from rising input costs and fuel price fluctuations to infrastructure concerns. Despite this, UD Trucks Southern Africa is maintaining a resilient performance, which in turn strengthens customer trust in the brand’s support for long-term business sustainability.

This is reflected in the company’s annual figures. UD Trucks Southern Africa achieved an 8% share of the overall new-vehicle market, and a 10,8% share in the heavy-duty segment. This contributed to aggregate industry sales which rose to 31 652 units, up from 31 190 units in 2024. The aftermarket business also saw considerable growth, with Service Agreement uptake reaching around 50%, underscoring the focus on long-term customer value, vehicle uptime and operational efficiency.

“While the operating environment remains challenging, our performance shows that customers trust UD Trucks to deliver reliable solutions that support their businesses,” says Filip Van den Heede, Managing Director of UD Trucks Southern Africa. “Our focus remains clear: to drive further for better by offering innovative products, strong retail partnerships and solutions that make a real difference to customer operations.”

The UD Quon, the flagship long-haul model, continues to lead innovation within the range. Built for demanding heavy-duty applications, the Quon integrates advanced technology with a focus on productivity and uptime for customers facing intense commercial pressure.

“The Quon represents the height of UD innovation—from performance and safety to driver comfort and connectivity. It is engineered for customers who expect more from their vehicles,” says Van den Heede.

The event also showcased the UD Quester, a model that has been integral to the brand’s success in growth markets globally. Since its launch in 2013, the Quester has established a reputation for efficiency, durability and versatility across sectors like long haul, general cargo, construction and waste management.

Its development is directly informed by customer feedback, with a clear emphasis on fuel efficiency, safety, driver comfort and uptime—all critical factors in managing the total cost of ownership.

Notable features on the 2026 UD Quester include:
• The ESCOT Direct Drive Gearbox, which contributes to fuel efficiency and consistent driving.
• A 4-Stage Retarder for enhanced braking performance and vehicle control.
• UD Stability Control to aid in rollover prevention and directional stability.
• A driver crash bag for added occupant safety.
• A refreshed cab interior designed with driver comfort and usability in mind.

“Quester is more than a truck—it is a business partner,” says Esaia Taunyane, Sales Director at UD Trucks Southern Africa. “Every feature on the Quester is guided by customer feedback. By improving efficiency, safety and the driver experience, we help customers reduce total cost of ownership and achieve stronger long-term returns on their fleet investments.”

With fuel being a major operational cost, the Quester’s engineering—including efficient powertrains, driving support systems and UD Connected Services—is designed to help customers achieve more kilometers per litre without compromising on performance or reliability.

Uptime remains a fundamental part of UD Trucks Southern Africa’s offering. Through proactive maintenance planning, predictive servicing and responsive breakdown support, the company helps customers reduce unplanned downtime and safeguard productivity.

“Uptime is about anticipation, not reaction,” says Sanjay Naipal, Aftermarket Director at UD Trucks Southern Africa. “By combining proactive maintenance solutions with strong dealer support and connected services, we help customers manage costs, protect productivity and keep their fleets moving—even in demanding operating conditions.”

UD Trucks Southern Africa continues to invest in its dealer network, understanding  strong retail environments are crucial to customer experience and uptime. Recent developments include the opening of the new CMH Commercial Pinetown dealership, upgrades to the McCarthy Commercial Boksburg facility to enhance service capability, and a major expansion at McCarthy Commercial Alrode to increase workshop and parts capacity. Further facility improvements are underway in Richards Bay, Worcester, Kimberley, Bloemfontein and Port Shepstone.

People are central to UD Trucks Southern Africa’s long-term strategy. Ongoing investment in cadet development, driver training and leadership programmes reinforces the commitment to building industry-ready skills.

“Driving further for better goes beyond our products,” Van den Heede concludes. “It reflects our purpose of creating a better life—for people, for the planet and for sustainable growth. It is about how we support our customers, empower our people and contribute meaningfully to the communities in which we operate.”

https://bit.ly/4k58gwp

Chinese EV Manufacturers Expand in Africa

Chinese electric vehicle manufacturers are swiftly expanding their presence across Africa, as trade barriers in Western markets encourage them to seek new customers on the continent. African demand for electric and hybrid vehicles has risen steadily, driven by urbanisation, higher fuel prices and government incentives for greener mobility.

Major cities such as Nairobi, Lagos, Johannesburg and Cairo are experiencing early adoption of EVs in private, commercial and ride-hailing fleets, despite infrastructure challenges like limited charging networks. The market is further buoyed by a surge in affordable models from Chinese automakers, which blend competitive pricing with plug-in hybrid technology to meet local needs.

Analysts note that Africa’s EV market remains small compared to global sales, but growth rates are among the fastest in emerging regions. This positions the continent as a critical frontier for automakers looking to diversify beyond traditional markets.

In this context, Hong Kong-based Tiazhou Okla Automotive Co., known as Okla Global, has announced a strategic partnership with Treadway Investment Bank to accelerate its expansion across Africa. Treadway will provide corporate finance expertise, facilitate government and private sector partnerships, and help Okla navigate regulatory frameworks in key African markets.

Under the agreement, Okla plans to establish manufacturing and assembly plants in Zimbabwe, South Africa, Nigeria, Kenya and Egypt. These facilities will serve as regional hubs: Zimbabwe and South Africa for the Southern African Development Community (SADC), Nigeria for the Economic Community of West African States (ECOWAS), Kenya for East Africa, and Egypt for North Africa.

Okla stated that this collaboration marks a significant step in its mission to become a leading player in Africa’s electric vehicle industry. Treadway’s role will be central in securing financing, navigating regulatory frameworks and leveraging government relationships to accelerate Okla’s rollout. The partnership is also expected to boost local economies by creating jobs and strengthening industrial ecosystems through localised assembly and production.

Okla’s entry comes amid rapid expansion by Chinese automakers across Africa over the past five years. Companies such as Build Your Dreams (BYD), Chery, Geely, Foton, Great Wall Motor, Haval and Sinotruk have pursued opportunities across the continent, focusing on affordable vehicles as they build local presence. Their growth has been supported by local assembly plants, accessible financing models and strong after-sales support, reshaping consumer expectations and the broader automotive market.

Simultaneously, local players are cultivating their own EV ecosystems. For example, MojaEV Kenya, a Nairobi-based EV distributor, is set to begin local assembly of electric vehicles in partnership with domestic assemblers later this year. This shift from imports to in-country assembly is seen as critical to lowering costs and meeting rising demand for sustainable transport in Kenya and neighbouring markets.

In a related development, Jiangsu Yunyi Electric Company, a high-tech Chinese manufacturer specialising in automotive electronic components, has announced plans to invest approximately R1,2-billion in a production site in Tangier, Morocco’s automotive hub. The company said the Tangier plant will serve as a key overseas production base, leveraging local resources to enhance its global competitiveness and support medium- to long-term strategic goals. Jiangsu Yunyi Electric provides innovative solutions for new energy vehicles, including voltage regulators, rectifiers, diodes, sensors and intelligent wiper systems.

Morocco is emerging as a global automotive powerhouse, attributed to its political stability, geostrategic location, economic performance and incentives for investors. The country’s automotive ecosystem employs over 222 000 skilled workers. This strategic sector has grown exponentially over the past decade, making Morocco the leader in Africa for automotive manufacturing and exports.

In 2025, Morocco’s automotive market was valued at approximately R89,82-billion and is projected to reach around R158,94-billion by 2030, according to expert forecasts. The sector is export-oriented, with 1-million cars produced in 2025. Morocco, which has increased its target to 1,5-million vehicles by 2026, produced 560 000 cars in 2024 and 250 000 in 2020.

https://bit.ly/4qM3OVc

AAAM's 2026 Goals: Boosting Africa's Automotive Industry

The African Association of Automotive Manufacturers (AAAM) has announced that 2026 will be its year of “progressive development through collaboration,” building on what it describes as a successful period of partnership-building in 2025.

Chief Operating Officer Victoria Backhaus-Jerling stated that the coming year would be focused on turning momentum into measurable outcomes. “Through our collective efforts, we have strengthened partnerships across the value chain,” she said. “Now is the time to translate that foundation into tangible progress for the continent’s automotive industrialisation.”

A key focus will be expanding AAAM’s continental footprint, bolstered by the establishment of its North Africa office in 2025. The office is intended to enhance engagement with regional stakeholders and reinforce North Africa’s role within the broader African automotive value chain.

The association has outlined eight strategic priorities for the year ahead. Top among them is unlocking intra-African trade by supporting the ratification and implementation of the automotive Rules of Origin under the African Continental Free Trade Area (AfCFTA). This follows the expected formal adoption by Heads of State in February of a 40% African originating content threshold—a milestone that would allow automotive products to begin trading under the AfCFTA framework. AAAM will work closely with Afreximbank, the AfCFTA Secretariat and African governments to guide members through the new trading environment.

Further priorities include accelerating automotive policy implementation in key markets such as Egypt, Ghana, Côte d’Ivoire, Kenya, Nigeria and Ethiopia, as well as engaging newer markets like Angola. “Policy certainty remains the foundation of sustainable industrialisation,” Backhaus-Jerling emphasised.

On the manufacturing front, AAAM aims to secure at least five concrete component manufacturing investments in Africa through targeted matchmaking and feasibility studies. The association will also advance sustainability initiatives, promoting re-manufacturing, alternative powertrains, micromobility solutions and supportive legislation for New Energy Vehicles.

Other focal points include enhancing automotive data and market intelligence across the continent, scaling up skills development through executive short courses, and fostering mineral beneficiation to connect Africa’s mining sector with local automotive manufacturing. As a strategic partner to the 2026 Mining Indaba, AAAM plans to help build a more integrated pan-African value chain.

Finally, the association reaffirmed its commitment to affordable mobility, noting continued collaboration with vehicle asset-financing stakeholders to develop accessible and sustainable transport solutions.

“All these initiatives are driven by a single commitment,” Backhaus-Jerling concluded, “to deliver greater impact for our members, strengthen collaboration, and deepen the partnerships that will accelerate sustainable industrial growth across Africa.”

https://bit.ly/3Z3KFCp

AAAM 2025: Great Milestones in Africa's Automotive Industry

The African Association of Automotive Manufacturers (AAAM) is closing 2025 on a high note, pointing to major strides in policy, capacity building, and regional integration as catalysts for the continent's automotive industrialisation.

The year saw a leadership transition, with the appointment of Victoria Backhaus-Jerling as the new CEO in March, committing to building on the strong foundation laid by former CEO Dave Coffey, steering the organisation towards what it terms "inclusive and strategic industry leadership."

Victoria Backhaus-Jerling

A significant operational move was the establishment of a dedicated North Africa office in Tunisia. This expansion is designed to bolster the association's footprint and directly support regional value chain development across the continent. Further strengthening its focus, AAAM also onboarded a dedicated project manager to drive the expansion of component manufacturing for both OEM assembly and the thriving aftermarket.

The association highlights a pivotal breakthrough for the sector: the conclusion of negotiations on the automotive Rules of Origin under the African Continental Free Trade Area (AfCFTA). This long-awaited agreement provides critical clarity for manufacturers and investors, forming the legal bedrock for integrated regional value chains and increased intra-African trade. With adoption targeted for February 2026, AAAM has pledged its support to member states and institutions to ensure effective implementation.

Intra Africa Trade Fair in Aligiers

Building on this policy milestone, AAAM, in partnership with Afreximbank and the AfCFTA Secretariat, launched an Industrial Policy Executive Short Course. The programme brought together senior policymakers to enhance capabilities in industrial policy design, localisation, and value chain development—a move AAAM believes is essential for creating sustainable automotive ecosystems.

The association also maintained its high-profile advocacy role, convening the Africa Automotive Forum at the Intra-African Trade Fair (IATF2025). The event served as a key platform, sparking dialogue among policymakers, manufacturers, and financiers on affordable mobility, competitive value chains, and the power of intra-African trade to achieve scale.

"Our engagements across North, East, West, and Southern Africa, as well as key international markets, have reinforced the unique dynamics of each region," says Backhaus-Jerling. "Our expanded footprint and strengthened partnerships are geared towards supporting the financing and policy frameworks needed to turn industrial ambition into reality."

As the association looks to 2026, the focus shifts firmly to implementation. With the foundational policies now taking shape, AAAM states its mission is to drive deeper collaboration and build resilient, inclusive automotive value chains across the African continent.

https://bit.ly/3MAnUDn

Hino Motors Unveils Future Transport Solutions at Japan Mobility Show

Japanese truck manufacturer Hino Motors showcased its vision for future transport at the recent Japan Mobility Show in Tokyo, highlighting both advanced mobility solutions and its enduring commitment to the Dakar Rally.

A centrepiece of the Hino exhibit was the production version of a hydrogen fuel cell-powered Hino 700 freighter. Designed to support carbon neutrality, this heavy-duty truck incorporates advanced safety technologies enabling Level 4 autonomous driving on expressways. The company said improvements to its radar system, along with new camera mountings and LIDAR sensors, aim to support its goal of reducing traffic casualties.

Also on display was a customised version of the Hino Dutro Z EV battery-electric vehicle, currently being shown at events in South Africa. The Tokyo exhibit featured a mobile office configuration, utilising the vehicle’s low cargo floor to create a walk-through, spacious interior. Hino suggests such derivatives could serve as on-site control rooms for managing outdoor events or disaster response.

In a separate motorsport endeavour, Hino will be the sole Asian truck manufacturer contesting the 2026 Dakar Rally in Saudi Arabia, marking its 35th consecutive entry. The event, running from January 3, will see a single Hino 600 Series racing truck compete against 46 other trucks from European manufacturers, including Iveco, MAN and Tatra. The Russian Kamaz team, a former dominant force, has not participated since 2023.

The 2026 route will form an 8 000 km loop starting and finishing in Yanbu, featuring 5 000 km of timed sections and a rest day in Riyadh on January 10. Team Hino Sugawara will be led by driver Teruhito Sugawara, who has completed the rally 20 times consecutively. He will be joined by navigator Somemiya Hirokazu and technician Mochizuki Yuji.

https://bit.ly/4pHY4eM

Morocco vs South Africa: The Future of the Automotive Industry

A strategic shift is unfolding across the African automotive landscape, defined not by a single event but by a confluence of ambitions in boardrooms from Casablanca to Johannesburg. The recent, quiet establishment of Tesla’s commercial presence in Morocco, signaled by the recruitment of a Country Sales & Delivery Leader in Casablanca, represents more than a new showroom; it is a calculated entry into a market being deliberately engineered as an electric vehicle hub.

This move coincides with a parallel gravitational pull from Chinese automotive manufacturers toward South Africa’s established industrial base, setting the stage for a continental transformation driven by competing visions of the future.

BAIC factory in South Africa's Eastern Cape

Morocco’s ascent is not accidental. While its overall vehicle production of 559 645 units in 2024 trails South Africa’s historical output, its trajectory and focus are distinct. The kingdom is poised to manufacture between 40 000 and 50 000 fully electric vehicles in 2024, a figure that underscores a targeted industrial policy.

This output is particularly significant given that South Africa has yet to produce a single fully electric vehicle domestically. Morocco’s 5% year-on-year production increase is built upon foundational advantages: geographic proximity to European markets and a charging infrastructure network of approximately 1 000 stations, dwarfing South Africa’s estimated 400-500.

Government policy has been instrumental in creating a fertile environment. Exemptions from value-added tax and customs duties on EV imports have lowered financial barriers for consumers and manufacturers alike. The market response is quantifiable, with EV sales reaching 1 125 units in 2024 and projected to surge to 4 248 in 2025.

Toyota's Prospecton factory near Durban, Kwa-Zulu Natal

This policy framework, designed to position Morocco as a central hub for EV manufacturing and sales, is what makes Tesla’s entry a strategic beachhead. The American automaker’s presence is widely interpreted as a move to capitalize on this surging demand and the country’s export-oriented logistics, potentially encouraging other EV-focused brands to consider North Africa.

“The country offers a mature industrial ecosystem, a skilled and experienced workforce, and a supply chain that has been tested and proven over decades,” says Lydia Zhang, Executive Vice President for Client Coverage in Corporate Investment Banking at Standard Bank, quoted recently in FANews. Zhang notes  South Africa’s role as a gateway to a continent with low motorisation rates presents a compelling investment rationale.

Yet, South Africa’s path is markedly different. Its automotive sector, a cornerstone of manufacturing for decades, finds itself at a crossroads. The rise of Chinese brands like Chery, GWM, BYD and BAIC has reshaped the domestic market, moving them from fringe players to household names based on affordability and improving quality.

This commercial success is now prompting deeper consideration. Several leading Chinese original equipment manufacturers (OEMs) have launched feasibility studies into establishing local assembly plants in South Africa, attracted by the existing supplier base and potential for continental growth.

This interest emerges as traditional manufacturers reassess their South African operations. The potential vacuum creates an opportunity, but one fraught with the nation’s well-documented challenges. “Infrastructure constraints, including energy supply and logistics, continue to be monitored,” Zhang observes, adding investors seek clarity on tariffs, labour laws and long-term policy.

The policy environment itself is a subject of intense debate. Experts argue South Africa’s automotive tax structure inadvertently undermines its own industrial ambitions.

Ford Ranger assembly in the modern plant in Rosslyn, Pretoria

“Our vehicles are overtaxed,” says Professor Justin Barnes, Executive Director of the Toyota Wessels Institute for Manufacturing Studies. He highlights an “inverted market structure” where ad valorem taxes are disproportionately high for cheaper vehicles, stifling domestic demand. Furthermore, the duty differential between imported completely built-up (CBU) units and locally assembled completely knocked-down (CKD) kits is considered too narrow, disadvantaging local component manufacturers who effectively compete against near-zero import duties.

South Africa’s Automotive Masterplan 2035 envisions producing 1,4-million vehicles annually, with half for the domestic and regional African market. Currently, the structure is inverted; the country imports more vehicles than it manufactures for local consumption. “We need a robust domestic market and need to make the regional market our operating environment,” Barnes argues. Failure to do so, he contends, leaves South African producers vulnerable to the demanding and rapidly shifting requirements of distant developed export markets, particularly as they transition to new-energy vehicles (NEVs).

This NEV transition is where the contrast with Morocco becomes stark. South Africa’s high import tariffs and limited purchase incentives have resulted in a negligible EV market. The finalization of a revised Automotive Production and Development Programme (APDP) framework to incentivize NEV production is seen as crucial. Such a policy could unlock a strategic advantage: South Africa’s duty-free trade access to Europe. This access could position the country as a manufacturing and export base for Chinese OEMs keen to produce NEVs for the European market.

“While we would expect Chinese OEMs to begin with semi-knocked down or limited-scale assembly, it is important that this evolves into full-scale CKD production within a defined timeframe,” says Lydia Zhang. “We see this progression as critical for job creation and meaningful local industry participation.”

The emerging picture is of a continent with two powerful, divergent automotive narratives. In the north, Morocco is leveraging agile policy, geographic advantage, and infrastructure investment to build a new, EV-centric manufacturing ecosystem from the ground up, attracting global pioneers like Tesla. In the south, South Africa’s established industrial complex, while grappling with internal policy contradictions and infrastructure woes, presents a compelling case for large-scale, traditional manufacturing investment, increasingly attractive to Chinese brands seeking scale and continental access.

The outcome will hinge on execution. Morocco must convert its potential into sustained industrial depth. South Africa must align its tax and trade policies with its masterplan ambitions to unlock regional demand and attract transformative investment. Together, these parallel developments signal that the African automotive industry is no longer on the periphery of global trends but is becoming a complex and contested arena where its future footprint is now being forged.

https://bit.ly/3XZdwHv