US Tariff Impact on South African Automotive Industry

The recent announcement of a 30% tariff by the United States on goods imported from South Africa has created significant concern within the global motoring industry. This substantial increase in tariffs is expected to have far-reaching implications for South African car manufacturers, exporters, and the broader economy. The auto industry is now preparing for the substantial adjustments that this policy shift will necessitate.

Key stakeholders are paying close attention to how these changes will play out, as the new tariff introduces a host of challenges for South Africa's automotive sector, impacting everything from production costs to market competitiveness.

South Africa's automotive exports to the United States have been a crucial component of the country's export portfolio. In fact, the export of vehicles and parts from South Africa to the US is valued at over $2-billion. The introduction of the tariff is poised to disrupt this flow significantly. Notably, automobile exports accounted for 64% of South Africa's exports under the US African Growth and Opportunity Act (AGOA) in 2024. With such a substantial reliance on the American market, the potential impact of the tariff cannot be underestimated.

Industry experts and economists are weighing in on the situation. Some predict a decrease in South African vehicle exports to the US, which could lead to surplus inventory and financial losses for manufacturers. Additionally, South African cars could become less competitive in the US market due to increased costs, further exacerbating the situation.

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The new tariff brings numerous difficulties for South African car manufacturers. An immediate concern is the rise in production costs, which stems from higher expenses for raw materials and components. This escalation in costs could lead to increased vehicle prices, potentially dampening demand in both domestic and international markets.

Manufacturers might need to reconsider their production strategies to stay competitive. This could include relocating manufacturing to countries with more favorable trade terms or investing in technologies that cut costs. However, such shifts require significant time and resources, adding to the industry's existing challenges.

Additionally, the uncertainty surrounding international trade relations could make it harder for manufacturers to plan for the future. The industry may face financial strain and operational disruptions as it navigates these complex issues.

Effects on the South African Economy

The broader South African economy is poised to experience significant repercussions due to the new US tariff. The automotive industry is not only a major contributor to South Africa's GDP but also a substantial employer, so a decline in exports could trigger widespread economic consequences. Potential job losses in the auto industry are a serious concern, as reduced production and export volumes may compel manufacturers to downsize their workforce.

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Additionally, the uncertainty surrounding trade relations with the US might dampen investor confidence in South Africa's automotive sector. This could lead to reduced investment, stalling the industry's growth and innovation. Companies may also face increased financial strain, making it harder to maintain operations and fund new projects.

The knock-on effects could extend to related industries, such as suppliers and logistics providers, amplifying the economic impact. Overall, the new tariff introduces a layer of complexity that the South African economy will need to navigate carefully, affecting everything from employment rates to future investment opportunities.

Responses from Industry Stakeholders

Industry stakeholders are actively addressing the tariff announcement, with varied reactions across the sector. Renai Moothilal, CEO of the National Association of Automotive Component and Allied Manufacturers, emphasized the need for more details, stating that the association will await further information on the specific components affected by the tariff proclamation.

Government officials and industry leaders are expected to pursue diplomatic discussions to negotiate the tariff's terms with the US, aiming for potential exemptions or revisions. Some stakeholders are urging the South African government to strengthen trade agreements with other countries to offset the impact of the US tariff.

There is also a call for increased investment in domestic technologies and alternative markets to reduce dependency on US exports. This multi-pronged approach could help mitigate some of the tariff's adverse effects on the South African automotive sector.

Chairperson of the federal council of the Democratic Alliance (DA), Helen Zille says the global tariffs unleashed by US President Donald Trump spell disaster for South Africa, amid the souring bilateral relationship.

“What can one say? It is going to be disastrous for our automotive industry in particular if they have 30%  tariffs slapped on our motor vehicles that are made in the facilities of Pretoria and Nelson Mandela Bay. Obviously, it is going to be terrible for us,” she said.

“The government won't learn. There is tension between the ANC and just about every democracy in the world, and there is certainly profound tension between the ANC and democrats in South Africa.”

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In the long run, South African car manufacturers will need to rethink their strategies to adapt to the new trade environment. They might start exploring untapped markets and diversifying their export destinations to reduce their reliance on the US This could involve strengthening trade relations with other countries and regions, potentially opening new avenues for growth. 

Additionally, investing in advanced manufacturing technologies and improving efficiencies could help mitigate the increased production costs imposed by the tariff. Collaborations with local and international partners could further enhance competitiveness and innovation within the industry. The South African auto industry's ability to navigate these changes will significantly influence its future trajectory.

The 30% US tariff on South African goods presents substantial challenges for the nation's automotive sector. The immediate consequences include a rise in production costs and potential job reductions, putting significant pressure on manufacturers to adapt swiftly.

Over the long term, the industry will likely need to diversify its export markets to lessen dependence on the American market. This shift could open new opportunities but will also require strategic investments in technology and efficiency improvements.

Stakeholders, including government officials and industry leaders, are working on responses to mitigate these impacts. Efforts are underway to negotiate better trade terms with the US and strengthen trade agreements with other countries. Additionally, there's a push for increased investment in domestic capabilities to reduce external dependencies.

The resilience of South African car manufacturers will be critical in navigating these changes. By exploring new markets and investing in advanced manufacturing technologies, the industry can adapt to the evolving trade landscape. While the road ahead is fraught with challenges, the potential for innovation and growth remains. The South African automotive sector's ability to pivot and respond strategically to these new conditions will significantly influence its long-term success and stability.

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BYD Expands EV Lineup with Innovative Models for South Africa

Global new energy vehicle manufacturer BYD has unveiled three models — the Shark 6, Sealion 6 and Sealion 7 — in South Africa, broadening its local lineup to six vehicles. The launch underscores the brand’s focus on delivering tailored, sustainable transport solutions amid growing demand for efficient mobility options.

Steve Chang, Managing Director of BYD Auto SA, expressed enthusiasm about the expansion: “South African drivers now have access to advanced technology that prioritises efficiency and adaptability. These models align with our vision of combining innovation with practicality, ensuring a greener future without compromising performance.”

The introduction follows the 2023 arrivals of the Atto 3 compact SUV, Dolphin hatchback, and Seal sedan. The latest additions complete BYD’s dual strategy of offering both plug-in hybrids (PHEVs) and electric vehicles (EVs), catering to diverse driving needs.

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BYD Shark 6
Marking BYD’s debut in South Africa’s pick-up segment, the Shark 6 pairs rugged capability with hybrid efficiency. Built on the DMO Super Hybrid Off-road Platform, the model merges off-road durability with SUV-like comfort.

A dedicated rear-drive powertrain, combined with a 1,5-litre rurbo engine and EHS electric hybrid system, generates over 320 kW — akin to a conventional 4,0-litre V8 — while accelerating from 0-100 km/h in 5,7 seconds. Intelligent electric all-wheel drive adjusts torque distribution in real time, optimising traction across varied terrains.

The plug-in hybrid offers a combined WLTP range of 670 km, including 85 km in pure electric mode. Even when relying solely on fuel, consumption remains at 9,6 l/100 km. Safety features include BYD’s Blade Battery, integrated via CTC technology to enhance structural rigidity by 22%, alongside a high-strength steel frame for added protection.

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BYD Sealion 6

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Designed for families, the Sealion 6 plug-in hybrid SUV balances power and practicality. Its Super DM-i technology enables seamless transitions between electric and hybrid modes, with an all-wheel-drive variant achieving 0-100 km/h in 5,9 seconds (238 kW power, 550 Nm torque). The front-wheel-drive model prioritises efficiency at 5,5 l/100 km, offering ranges of 1 080 km (FWD) and 870 km (AWD).

Tech highlights include a 15,6-inch adaptive infotainment screen, voice control and a head-up display projecting real-time driving data. The cabin’s intuitive layout aims to enhance connectivity, making it suited for both urban errands and cross-country journeys.

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BYD Sealion 7

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As BYD’s fourth pure EV in South Africa, the Sealion 7 sport-coupé SUV combines rapid acceleration with luxury. Its rear motor — featuring dual V-shape magnets and a 92% slot-fill rate — spins at up to 23 000 r/min, enabling a 0-100 km/h sprint of 4,5 seconds (Performance edition) or 6,7 seconds (Premium edition). The 82,56 kWh Blade Battery delivers up to 482 km (WLTP), while 150 kW DC fast-charging restores 20%-80% capacity in 30 minutes.

Cell-to-Body (CTB) architecture maximises cabin space, offering 500 litres rear and 58 litres front storage. A rotating 15,6-inch touchscreen, compatibility with Android Auto and Apple CarPlay, and a 12-speaker Dynaudio system elevate in-car entertainment.

In a brief shimmy around a Sandton car park in the car, what really stood out besides the blissful acceleration and seemingly endless power was the massive rear seat space that still left room in the luggage department for more than a weekend getaway.

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The new models will debut across eight BYD dealerships in South Africa, with plans to expand sales and service networks. Each vehicle includes tailored charging solutions, such as a 7 kW wall box and portable charger for the Sealion 7.

Established in 1995, BYD has evolved from a battery producer to a global leader in renewables and transport, operating in over 400 cities worldwide. Its automotive division, BYD Auto, specialises in EVs and PHEVs, pioneering technologies like the Blade Battery and CTB construction. The firm ceased production of internal combustion engines in 2022, focusing solely on zero-emission mobility.

Pricing:

Sealion 7 Premium FWD           R1 099 900

Sealion 7 Performance AWD     R1 299 900

Sealion 6 Comfort FWD             R   639 900

Sealion 6 Dynamic FWD            R   689 900

Sealion 6 Premium AWD           R   789 900

Shark 6                                     R   959 900

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Speed up AfCFTA and industrialise

Zimbabwe’s Finance, Economic Development, and Investment Promotion Minister, Professor Mthuli Ncube, has underscored the urgency of advancing industrialisation and expanding Special Economic Zones (SEZs) across Africa to accelerate the implementation of the African Continental Free Trade Area (AfCFTA). Speaking at the 57th Session of the Conference of African Ministers of Finance, Planning, and Economic Development in Addis Ababa, Ncube positioned these measures as vital for unlocking the bloc’s economic potential.

Zimbabwe, which ratified the AfCFTA agreement in May 2019, is among the early adopters of the initiative designed to create a unified continental market. The pact, established in 2018, seeks to dismantle trade barriers, harmonise regulations and boost intra-African commerce, which currently lags behind other regions. With a population of 1,4-billion and a collective GDP exceeding $3,4-trillion, the AfCFTA could elevate intra-African trade by 45% by 2045 — if infrastructural and regulatory challenges are resolved.

During his address, Ncube outlined key priorities drawn from discussions with the Committee of Experts. Strengthening regional value chains in agriculture, manufacturing, and services was highlighted as a priority to reduce reliance on raw commodity exports.

“Enhancing trade infrastructure and addressing non-tariff barriers will be central to maximising value addition,” he said, pointing to the need for harmonised regulations and improved access to finance.

The outgoing conference chair echoed these sentiments, advocating for innovative financing mechanisms such as blended finance and thematic bonds to support businesses. Digital transformation was also flagged as a catalyst for growth. Ncube stressed that integrating e-commerce platforms, digital trade tools, and fintech solution into the AfCFTA framework could lower transaction costs and broaden market access.

Zimbabwe’s Automotive Sector Opportunity
Zimbabwe’s recent approval of provisional tariff concessions by the AfCFTA Secretariat positions it to begin preferential trading under the agreement. This milestone aligns with the nation’s ambitions to leverage its mineral wealth, particularly in lithium and steel, to participate in regional value chains.

A recent study by Afreximbank, the AfCFTA Secretariat, and the African Association of Automotive Manufacturers identified several Zimbabwean firms — including Chloride Zimbabwe and United Springs — as potential contributors to Africa’s automotive sector.

With global demand for electric vehicles rising, Zimbabwe’s lithium reserves, critical for battery production, could see it emerge as a hub for component manufacturing. Ncube noted that such opportunities align with broader efforts to diversify economies and reduce dependency on volatile commodity markets.

As South Africa assumes the G20 presidency, Ncube urged African leaders to seize the platform to advocate for reforms in global financial architecture. He called for inclusive frameworks to improve access to climate finance and support sustainable development goals.

“Green industrialisation must be prioritised,” he added, emphasising the potential for renewable energy investments and climate-resilient trade policies to position Africa as a leader in sustainable growth.

While progress on the AfCFTA advances, concerns linger over external trade pressures. In South Africa, automotive sector stakeholders convened at the National Union of Metalworkers’ Bargaining Conference to discuss the potential fallout from losing access to the US African Growth and Opportunity Act (AGOA). Toyota CEO Andrew Kirby warned that exclusion from AGOA could cost the company 7% of its manufacturing output, underscoring the fragility of export-dependent industries.

Lada Iskkra

Meanwhile, Russian automaker AvtoVAZ announced plans to expand into Nigeria, targeting West Africa’s largest economy with a spare parts hub in Lagos by 2025. The firm, known for its Lada vehicles, is also exploring partnerships to establish a compressed natural gas conversion plant, aligning with Nigeria’s push for alternative energy solutions. With annual vehicle demand in Nigeria estimated at 720 000 units — far outstripping local production of 14 000 — the move signals growing international interest in Africa’s underdeveloped automotive markets.

As the ministerial conference closed, Ncube urged delegates to translate dialogue into tangible policies. “Macro-economic stability, debt management, and domestic resource mobilisation are non-negotiable for building investor confidence,” he asserted, stressing the need for coordinated national and regional strategies.

The outgoing chair reinforced this call, noting, “This conference must drive concrete commitments—not just aspirations—to realise Africa’s economic transformation.” With Zimbabwe poised to commence AfCFTA trading and regional partnerships gaining momentum, the bloc’s ability to address structural hurdles will determine whether its ambitious vision translates into equitable prosperity.

As global automakers and African industries navigate shifting trade dynamics, the continent’s path to industrialisation remains a complex yet pivotal endeavour—one requiring collaboration, innovation, and an unwavering focus on sustainable growth.

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Africa Automotive - All eyes on Algeria for IATF2025

Algiers is set to become the epicentre of Africa’s automotive industry as it hosts the Africa Automotive Show, a flagship event at the Intra-African Trade Fair (IATF) 2025. From September 4 to 10, 2025, the Democratic People’s Republic of Algeria will welcome industry leaders, innovators and policymakers to what promises to be a transformative gathering for the continent’s automotive sector.

Organised by Afreximbank, the African Union, and the African Continental Free Trade Area (AfCFTA) Secretariat, the event builds on the momentum of IATF 2023 in Cairo, where trade deals worth a staggering $43,8-billion were sealed, attracting more than 28 000 visitors and 1 939 exhibitors.

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The Africa Automotive Show is more than just an exhibition; it’s a strategic platform designed to accelerate the growth of Africa’s automotive industry. With intra-African trade currently accounting for just 14% of the continent’s global trade, the event aims to boost collaboration, innovation and investment in a sector that is increasingly seen as a cornerstone of Africa’s economic future.

Africa’s automotive potential is no longer a distant dream but a tangible reality. The continent is fast becoming a hub for both local and international players, with the African Association of Automotive Manufacturers (AAAM) leading the charge.

Victoria Backhaus-Jerling, AAAM’s newly appointed CEO, describes the moment as pivotal: “Our goal is to elevate the African market demand to between three and five million units by 2035,” she says. “This is a significant leap from where we are today, but it’s achievable with the right collaboration and investment.”

Victoria Backhaus-Jerling

The Africa Automotive Show will feature a two-day forum alongside a dedicated exhibition, creating a space for dialogue, partnership and progress. The event will bring together stakeholders from across the automotive value chain, including raw material suppliers, manufacturers, dealers and financial partners. It will also serve as a platform to showcase Africa’s achievements in the sector while laying the groundwork for future growth.

The 2023 edition of IATF in Cairo set a high bar, demonstrating the power of collaboration and the potential of intra-African trade. The Africa Automotive Show at IATF 2025 aims to build on this success, with a particular focus on advancing the continental automotive strategy approved by AfCFTA member states earlier this year.

This strategy, developed with input from AAAM, Afreximbank, and the AfCFTA Secretariat, aims to strengthen regional supply chains, boost local manufacturing, and promote African-made solutions.

One of the key challenges facing the industry is the dominance of used vehicle imports, which currently account for a significant portion of Africa’s automotive market.

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Backhaus-Jerling emphasises the need for a phased approach to reducing these imports. “The volume of used vehicles dilutes the opportunity for local manufacturing and after-sales services,” she explains. “By investing in local production, we can create jobs, empower communities, and build a resilient intra-African supply chain.”

As the host nation, Algeria is poised to play a leading role in shaping the future of Africa’s automotive industry. The country has recently implemented policy reforms to attract investment and boost local manufacturing. Major assembly plants, such as those operated by Stellantis, have already been established, signalling Algeria’s commitment to driving industrialisation and inspiring similar developments across the continent.

Algeria’s strategic location and growing infrastructure make it an ideal host for the Africa Automotive Show. The event will not only showcase the country’s progress but also highlight its potential as a key player in Africa’s automotive ecosystem.

The Africa Automotive Show is more than just a trade event; it’s a gateway to an integrated African market of some 1,3-billion people and a combined GDP exceeding $3,5-trillion. Enabled by the AfCFTA, this market represents a wealth of opportunities for industry players, from raw material suppliers and manufacturers to dealers and aftermarket providers.

Andrew Binning, Director of the Africa Automotive Show, describes the event as the ultimate platform for industry stakeholders. “Our vision is to unite players from every corner of Africa and beyond,” he says. “This is where the future of Africa’s automotive industry will be shaped.”

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The Africa Automotive Show will feature a diverse range of exhibitors, including original equipment manufacturers (OEMs), national assemblers and value chain partners. The accompanying Automotive Forum will bring together thought leaders, global partners, and heads of state to discuss the challenges and opportunities facing the industry.

By fostering collaboration, innovation, and investment, the show has the potential to transform the continent’s automotive landscape, creating jobs, boosting economies, and improving mobility for millions of people.

In the words of Victoria Backhaus-Jerling: “This is more than an event; it’s a catalyst for change. Together, we can build an automotive industry that reflects Africa’s resilience, creativity, and entrepreneurial spirit.”

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Revealed: The True Numbers Behind South Africa's Car Industry in 2025

South Africa's roads now have about 12-million vehicles. This remarkable figure highlights the country's vehicle growth from 10.3 million registered vehicles in 2020.

The automotive sector reveals some intriguing patterns. Only 2,4-million vehicles have financing, while 3-million carry insurance. The industry generates 24-million sales leads yearly but converts these into just 580 000 vehicle sales. New vehicles account for 180 000 sales and used vehicles make up 400 000 of the total.

January 2025 brought encouraging news with vehicle sales hitting 46 400 units - a 10,4% jump from December 2024. This analysis will dive into these numbers deeply. We'll look at market trends and fleet management challenges to give you a detailed picture of South Africa's evolving automotive sector.

South Africa's automotive sector continues to thrive in early 2025 as growth spreads through many segments.

Total Vehicle Population Statistics 2025

The automotive industry plays a vital role in South Africa's economy and factors in 4.9% of the GDP (2,9% manufacturing and ,02% retail). South Africa ranks as the 22nd largest vehicle producer worldwide with a 0,65% share of global vehicle production. The country's automotive manufacturing makes up 21,7% of domestic manufacturing output.

New Vehicle Sales Growth Trends

January 2025 started strong as the total domestic new vehicle sales reached 46 398 units. This represents a rise of 4 375 units or 10,4% compared to January 2024. The passenger car segment performed well with 34 530 units, an 18,3% jump from the previous year. On top of that, car rental sales made up 19.,% of new passenger vehicle sales.

AI generated image

Regional Market Distribution

The market reveals interesting regional patterns. SADC countries lead South Africa's export market. Namibia, Botswana, Zimbabwe and Zambia have become the main export destinations – Kenya and Ghana now just need more South African vehicles.

The domestic market shows new trends in import sources. India's share of vehicle imports grew from 11% in 2012 to 28% in 2022 . Chinese manufacturers have gained ground too, and their market share expanded from 1% to 11% between 2010 and 2022. They achieved an annual growth rate of 7.2%.

Credit Application Success Rates

The credit market of 2025 shows mixed signals. Vehicle loan originations grew 1,1% in Q3 2024, and average new account amounts increased by 2,4%. The total number of active Vehicle Asset Finance (VAF) accounts stands steady at 2,1-million. The market remains strong as 80% of new cars and over 50% of used cars secure financing.

Alternative Financing Options

The changing market has led to new financing solutions for #carbuyers:

- South African roads now have 25 000 vehicles under long-term rentals and subscriptions
- Lease agreements come with flexible terms and optional end-of-term purchase rights
- Rent-to-buy models have become popular alternatives to traditional financing

The financing world shows a clear generational change. Gen Z's share of new vehicle loans has grown from 13,7% to 16,6%. Millennials lead the pack with 40% of new vehicle purchase. Q2 2024 saw the average loan value reach R400 000, showing how financial pressures continue to shape #carlifestyle choices.

Fleet Management Transformation #fleetmanagement

South African fleet managers are moving faster toward digital transformation, and 91% plan to increase their investment in digital fleet technologies over the next five years.

The fleet management sector continues to show resilient growth, and active systems should reach 3,8-million units by 2028. Five domestic players control 70% of the market share. January 2025's commercial vehicle sales demonstrate this growth, with medium trucks showing an 11.6% increase.

Digital Fleet Solutions Impact

AI leads the state-of-the-art fleet solutions, with 23% of fleet managers already using AI solutions. These managers expect AI adoption to reach 58% within the next five years. AI technology shows its effects in several areas:

- 62% expect AI to optimize route planning
- 56% anticipate improved driver safety
- 55% look forward to better predictive maintenance

Operational Cost Trends

Total Cost of Ownership (TCO) remains crucial in fleet management decisions. Fleet expenses split between fixed and variable costs, with maintenance and fuel making up the largest variable expenses. Fleet managers now emphasize proactive maintenance strategies to reduce unplanned downtime and extend vehicle lifespans.

Fleet management software makes real-time expense tracking and TCO calculation possible. IoT sensors monitor vital components and detect potential problems early. This comprehensive strategy helps avoid expensive repairs while keeping optimal fleet availability.

South Africa's e-commerce market has reached R71-billion in 2023, which has led to a surge in the logistics sector's vehicle needs. This represents a 29% growth from the previous year.

The commercial vehicles market continues to expand strongly. Fastway Couriers has grown their delivery fleet by 132% in Gauteng alone in the last decade. The manufacturing segment leads as the fastest-growing sector in the South African freight and logistics market and projects a growth rate of 7% during 2024-2029.

These key factors shape delivery vehicle sales:

- Increased urbanization and e-commerce volumes
- Implementation of route optimization technologies
- Growing need for electric and hybrid commercial vehicles
- Rising need for urban delivery solutions

E-commerce Impact on Fleet Requirements

Online retail sector's expansion reshapes fleet requirements completely . Road transport now handles 85% of all exports to ports or airports. The wholesale and retail trade segment leads the freight and logistics market with a 39% market share in 2024.

E-commerce growth creates unique challenges for delivery fleets. Fuel costs and security expenses affect operational efficiency substantially. Last-mile delivery costs range between R90 to R900 per package. This has led companies to explore innovative solutions like aggregator platforms and crowdsourced delivery services.

Rhenus South Africa shows how the logistics industry adapts through expansion. They opened a 3 000 square meter warehouse near Pretoria and a 2 000 square meter facility in East London. M24 Logistics revealed a 30 000 square meter warehouse in Montague Gardens. These developments show how the sector responds to growing e-commerce needs.

South Africa's automotive sector continues to evolve rapidly. Vehicle financing companies now offer groundbreaking options such as long-term rentals and subscription models that match what customers just need. Fleet managers lead the way in digital advancement, and 91% of them plan to invest more in technology over the next five years.

E-commerce growth propels the logistics sector forward, especially when you have rising delivery vehicle demands. The R71-billion e-commerce market value and expanding warehouses in major cities reflect these economic changes.

Regional trends paint a clear picture. SADC countries continue as key export partners while India and China increase their vehicle imports to the domestic market. These developments create a more diverse and competitive automotive landscape.

The country ranks as the world's 22nd largest vehicle producer and contributes 4,9% to the GDP. This shows the automotive sector's crucial role in the national economy. The industry's flexibility and expansion point to a bright future through 2025 and beyond.

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Africa Automotive - 2024 Growth of Africa's Automotive Sector

In 2024, Africa's automotive sector witnessed notable progress, primarily spurred by increased local production and advantageous trade policies. The continent is attracting a variety of automakers, both international and local, who recognise the potential within the region. This interest has led to a rise in automotive manufacturing plants across multiple African countries, reflecting a deliberate move towards regional production. The industry is also seeing a diversification of vehicle models being produced, catering to both local market demands and export opportunities.

Efforts to bolster the automotive industry are evident in the investments being made in infrastructure and technology. Countries such as South Africa, Nigeria, and Morocco are key players, offering a blend of skilled labour and favourable business environments. This development is creating job opportunities and fostering skills transfer, contributing to broader economic growth.

Another critical factor in this growth is the increasing collaboration between governments and industry stakeholders to create supportive policies and initiatives. These include tax incentives for manufacturers, streamlined customs procedures, and efforts to harmonise vehicle standards across the continent. Such measures are aimed at making Africa an attractive destination for automotive investment.

Furthermore, the push towards sustainability is also shaping the sector, with an increased focus on electric vehicles and green manufacturing practices. This trend is aligning with global shifts towards environmentally friendly motoring solutions, positioning Africa as a forward-thinking player in the global automotive arena.

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Impact of the African Free Trade Agreement

The African Continental Free Trade Agreement (AfCFTA) has the potential to transform the automotive industry across the continent. By connecting more than1,3-billion people into a single market, the AfCFTA provides significant opportunities for automakers to expand their reach and streamline operations. Additionally, a World Economic Forum report anticipates that global business under this agreement could boost the African automotive industry by $12-billion by 2027. These developments promise a more integrated market, reducing tariffs and improving trade efficiencies among African nations.

The removal of trade barriers under the AfCFTA is expected to ease the movement of automotive components and finished vehicles across borders. This will likely result in lower costs for manufacturers and consumers alike, fostering a more competitive market environment. Additionally, the agreement encourages regional value chains, allowing different African countries to specialise in various stages of vehicle production. This approach can lead to increased efficiency and higher-quality outputs.

Moreover, the harmonisation of regulations and standards across member states will simplify compliance for automakers, making it easier for them to operate in multiple countries. This is particularly beneficial for small and medium-sized enterprises looking to enter the automotive market. The AfCFTA's emphasis on economic integration and industrialisation aligns with the broader goal of sustainable development, positioning Africa as an increasingly attractive destination for automotive investment.

Indicators of Growth in the Automotive Industry

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The positive trajectory of Africa's automotive sector can be seen through various indicators. Afreximbank, in collaboration with the African Association of Automotive Manufacturers, is actively supporting industry growth. By harmonising automotive standards, developing training programmes, and providing financing, they aim to facilitate industry growth, with Afreximbank committing $1 billion to these efforts.

Vehicle production and sales figures are on the rise, reflecting increased consumer demand and manufacturing capacity. The establishment of new manufacturing plants in various African nations demonstrates robust confidence from both international and local investors. These investments are not only boosting production but also generating employment opportunities and enhancing skill development.

Furthermore, the automotive sector is benefiting from a rise in partnerships and joint ventures aimed at leveraging local expertise and global technology. This collaborative approach is leading to improved production processes and the introduction of innovative vehicle models tailored to the African market.

Another crucial indicator is the development of supply chain networks that are becoming more sophisticated, ensuring the efficient movement of automotive components and finished vehicles. These advancements are essential for meeting the growing demand for cars and motoring solutions across the continent.

In summary, these indicators highlight the increasing dynamism within Africa's automotive industry, showcasing a sector poised for sustained growth and development.

Industry Challenges

The African automotive industry, despite its promising growth, faces a range of challenges that could impede its progress. One of the most pressing issues is the inadequacy of infrastructure. In many regions, road networks and port facilities are not sufficiently developed to support efficient supply chain operations. This situation creates bottlenecks that can delay the movement of automotive components and finished vehicles, thereby increasing costs and affecting competitiveness.

Economic instability in some African nations also poses significant risks to the industry's growth. Fluctuations in currency values and inflation rates can create an unpredictable business environment, making it difficult for automakers to plan long-term investments. Additionally, political instability in certain areas can deter potential investors and disrupt existing operations.

Another challenge lies in the regulatory landscape, which can vary significantly from one country to another. This lack of uniformity complicates compliance for automakers, particularly those looking to operate across multiple African nations. While efforts are being made to harmonise vehicle standards under initiatives like the AfCFTA, achieving comprehensive regulatory alignment remains a work in progress.

Furthermore, access to financing is a critical hurdle for many local enterprises looking to enter the automotive sector. High interest rates and limited availability of credit can stifle innovation and restrict the growth of small and medium-sized enterprises that are essential for a vibrant automotive ecosystem.

Labour issues, such as the availability of skilled workers, also present obstacles. While some countries are investing in training programmes, the overall skill level of the workforce needs to be elevated to meet the demands of advanced automotive manufacturing.

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Technological Progress and Innovation

Technological advancements are playing a pivotal role in Africa's automotive evolution. There is a noticeable rise in electric vehicle production and adoption, driven by the continent's commitment to sustainable development. Pilot projects for sustainable vehicles are already underway in Rwanda, Egypt, and South Africa, with e-mobility startups emerging across the continent. The introduction of smart technologies in vehicles, such as advanced driver-assistance systems and connectivity features, highlights Africa's readiness to embrace innovation and align with global automotive trends.

Market Potential and Consumer Preferences

Africa's automotive market is burgeoning, spurred by emerging economies and an expanding middle class. These factors are significantly reshaping consumer preferences across the continent. There's a noticeable shift towards vehicles that prioritise sustainability, reflecting broader global trends towards environmentally conscious motoring. This change in preference offers automakers a valuable opportunity to introduce eco-friendly models that align with the increasing environmental awareness among African consumers.

In addition to the demand for sustainable vehicles, there's a growing appetite for advanced features and technologies in cars. African consumers are becoming more discerning, seeking vehicles equipped with the latest in safety, connectivity, and comfort. This trend is pushing automakers to innovate and adapt their offerings to meet these evolving expectations.

Moreover, the rise in disposable income among the middle class is leading to a higher demand for a diverse range of vehicles, from economical models to luxury cars. This diversity in consumer demand is encouraging manufacturers to broaden their portfolios to cater to different segments of the market. The interest in luxury and premium vehicles, in particular, is indicative of a market that is maturing and becoming more sophisticated.

The burgeoning interest in electric vehicles is another critical aspect of the changing market dynamics. Governments and private entities alike are increasingly promoting electric mobility as a sustainable alternative to traditional combustion engines. This is not only in line with global sustainability goals but also addresses local issues such as urban air pollution and fuel dependency.

Overall, the evolving market potential and consumer preferences in Africa present a promising landscape for the automotive industry. By responding to these trends, automakers can tap into a market that is both growing and increasingly sophisticated in its demands.

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Future Outlook and Opportunities

Looking ahead, Africa's automotive sector is poised for further advancement, driven by a combination of strategic investments, policy reforms, and technological innovation. The region's commitment to enhancing infrastructure and reducing trade barriers sets the stage for a more integrated and efficient automotive industry. Continued collaboration between governments and industry stakeholders will be crucial in creating an environment conducive to growth and innovation.

One of the most promising opportunities lies in the development of electric vehicles, with several countries already pioneering initiatives in this space. The shift towards sustainable motoring not only aligns with global trends but also addresses local challenges such as air quality and fuel dependency. This focus on green technology could position Africa as a leader in the adoption of environmentally friendly automotive solutions.

Additionally, the rising middle class and increasing urbanisation are expected to drive demand for a diverse range of vehicles, from budget-friendly models to premium cars. This expanding market offers a lucrative opportunity for automakers willing to tailor their offerings to meet the specific needs and preferences of African consumers.

Partnerships and joint ventures between local firms and global automakers are likely to enhance the transfer of knowledge and technology, fostering innovation and boosting production capabilities. As these collaborations flourish, they will contribute to the overall competitiveness of Africa's automotive sector on the global stage.

In summary, the future of Africa's automotive industry holds significant promise, with numerous opportunities for growth and development as the continent continues to embrace modernisation and innovation.

Originally published on CHANGECARS

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Africa Automotive: All go for IATF 2025 with eyes on Auto Sector

With the ‘go’ button having been pressed on the Intra-Africa Trade Fair 2025 taking place in Algiers, Algeria in September next year, the countdown has begun towards an event expected to result in trade an investment deals exceeding US$44-billion.

Although only a sub-set of the entire IATF event, the Africa Automotive Show will play a large – and significant – part in the proceeedings given the intense activity in the automotive sector taking place throughout Africa that, together with full acceptance and implementation of the African Continental Free Trade Are (AfCTA) is helping to turn the continent into one large automotive hub.

Some 35000 attendees from more than 140 nations are expected to gather in Algiers for the Intra-African Trade IATF2025 and the week-long exhibition will feature 2 000 exhibitors from Africa and around the globe, showcasing goods and services to potential buyers and industry professionals.

Organised by the Government of Algeria under the theme ‘Gateway to New Opportunities’, the event will leverage the AfCFTA, which comprises around 1,4-billion people and a combined GDP of more than US$3,5-trillion. The biennial fair is run by the African Export-Import Bank (Afreximbank) in collaboration with the African Union and AfCFTA Secretariat.

Chief Olusegun Obasanjo, Chair of the IATF Advisory Council and former Nigerian president, highlighted the fair’s impact: “The IATF has become a vital platform for fostering intra-African trade and investment by facilitating business interactions and providing access to trade and market information. With more than 70 000 visitors and more than 4 500 exhibitors at the last three editions, the fair has contributed $100-billion in trade deals. We encourage African businesses to seize this opportunity to expand their markets and engage with peers."

The event will host numerous key activities, including a trade exhibition, the Creative Africa Nexus (CANEX) programme, featuring exhibitions and summits on African fashion, film, music, literature, sport, and more.

An example of the burgeoning automotive activity is the recent announcement by Stellantis to expand its Middle East and Africa (MEA) footprint by launching the locally assembled Jeep Grand Cherokee L in Egypt. This milestone, achieved at the Arab American Vehicles (AAV) plant in Cairo, is a pivotal part of the automaker’s ‘Dare Forward 2030’ strategy.

“This marks a crucial moment for Stellantis in Egypt,” said Samir Cherfan, Chief Operating Officer of Stellantis MEA. “By restarting production at AAV, we are reaffirming our commitment to Egypt's industrial growth and aiming to solidify our leadership in the region. Our goal is to capture over 22% of the market by 2030.”

Cherfan revealed Stellantis’ ambitions to become the top player in the region, selling 1-million vehicles annually by 2030, with 35% of those being electric. The plan also includes achieving 90% local production autonomy, reinforcing the company’s position as the most regionally integrated automotive manufacturer.

The local assembly of the Jeep Grand Cherokee L not only supports Stellantis' vision but also highlights Egypt’s strategic role within its wider operations. This move strengthens the company’s ability to serve markets across the MEA, boosting local job creation and skills development.

While the Egyptian production will be for left-hand drive markets, Stellantis South Africa notes it is not inconceivable this could expand to right-hand drive markets particularly in Sub-Saharan Africa.

Hesham Hosni, Managing Director of Stellantis Egypt, noted: “Our long-standing partnership with the AAV plant is key to our success here. This relaunch reflects our confidence in Egyptian expertise and infrastructure."

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August 2024 Vehicle Sales See Decline Despite Strong July Performance

New vehicle sales in South Africa took a dip in August 2024, following a robust performance in July, according to naamsa | The Automotive Business Council. Despite the positive momentum in July, the market couldn't maintain its upward trajectory into August.

The total domestic new vehicle sales for August 2024 stood at 43,588 units, marking a decrease of 2,266 units or 4.9% compared to the 45,854 vehicles sold in August 2023. The export market saw an even sharper decline, with sales dropping by 14,658 units or 34.3%, resulting in 28,073 vehicles exported in August 2024 compared to 42,731 units in the same month last year.

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Within the total industry sales, 35,503 vehicles, or 81.5%, were sold through dealerships. The vehicle rental industry accounted for 12.4% of sales, government purchases made up 3.3%, and corporate fleets accounted for 2.8%.

On a positive note, the new passenger car market saw growth, with 30,022 units sold in August 2024, an increase of 891 cars or 3.1% from the 29,131 sold in August 2023. Car rental sales were particularly strong, contributing 16.7% of all new passenger vehicle sales for the month.

However, the market for new light commercial vehicles, including bakkies and minibuses, experienced a significant decline, with sales falling by 2,941 units or 21.5% to 10,709 vehicles, compared to 13,650 in August 2023. The medium and heavy truck segments showed mixed results. Medium commercial vehicle sales rose by 8.1% to 748 units, while heavy trucks and buses saw a decrease of 11.4%, with only 2,109 units sold compared to 2,381 in August 2023.

The overall decline in vehicle exports continued, influenced by weak economic activity in Europe. Despite this, vehicle exports to the US saw a significant increase of 132% for the year to date compared to the same period in 2023.

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The naamsa SA Auto Week, scheduled for October 15-18, 2024, at the Cape Town International Convention Centre, will provide a crucial platform for networking and discussions within the South African automotive sector. The event will showcase 100 years of the industry’s history and include the naamsa Accelerator Awards and the Captains of Industry Gala, among other highlights.

Despite the challenges, there are signs of optimism. The stronger rand, lower consumer inflation, decreasing fuel prices, and potential interest rate cuts before the end of the year are expected to boost consumer sentiment and economic activity. While immediate improvements in vehicle affordability may be limited, these factors are anticipated to contribute to a more positive outlook for the remainder of the year.

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Cape 1000 back again next year

The Cape 1000 is set to return for its fourth edition from in March 2025. The event, which annually adjusts its routes to showcase different parts of the Western Cape, will start at the V&A Waterfront in Cape Town, with stops in Hermanus, Franschhoek, and Ceres, before concluding back in Cape Town.

It will again be hosted in partnership with Private Clients by Old Mutual Wealth and will feature a new collaborator, the Official Ferrari Dealer Scuderia South Africa. Scuderia South Africa plans to participate with four vehicles, including both modern sports cars and classic models.

Entries for the event are now open, with participation limited to 65 cars. The Cape 1000, which started in 2022, is a regularity rally inspired by international tribute races. 

It features four categories: Pre-1976 (Classic), 1977-1996 (Modern Classic), 1997-current (Sports), and Restomod/Recreation. This diversity allows a wide range of vehicles to compete, contributing to the event's unique character.

Event Director Vanessa Crichton expressed enthusiasm about the upcoming rally, highlighting its international appeal and the scenic routes that will be featured once again. The organisers intend to place greater emphasis on the regularity rallying component in next year’s event, while still maintaining the grand touring experience.

Private Clients by Old Mutual Wealth, a company specialising in investment and wealth management, continues to support The Cape 1000. Jean Minnaar, Managing Director, noted the alignment between the event’s celebration of engineering excellence and the company's core values. Minnaar also acknowledged the event’s role in attracting collectors from around the globe to South Africa.

Participants can look forward to an experience marked by stunning landscapes, high-quality accommodation, and strong camaraderie. Registration details are available at www.cape1000.com.

Proceeds from the event will support the Motorsport Legends Benevolent Fund, which provides financial assistance to members of the motorsport community in need, particularly those of older generations.

The event will also support the QuadPara Association of South Africa (QASA), a leading organisation representing individuals with spinal cord injuries and physical disabilities, offering programmes and services aimed at societal integration.

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Africa Automotive: Morocco usurps South Africa as leading auto hub

In the realm of motoring manufacturing in Africa, Morocco has emerged as a surprising leader, outpacing traditional powerhouse South Africa. With a strategic geographical positioning, favourable economic policies, robust infrastructure, a skilled workforce and competitive production costs, Morocco has become the continent's auto hub.

Morocco's advantageous positioning on the world map, nestled at the junction where Europe, Africa and the Middle East converge, naturally bestows upon it an unparalleled edge in market accessibility. This prime location not only facilitates the seamless movement of goods across borders but also significantly reduces transportation costs and timeframes.

Automakers, in pursuit of establishing a global footprint, find Morocco's proximity to European markets particularly appealing, as it enables them to cater to a diverse customer base with heightened efficiency. The nation’s strategic placement is not merely a geographical boon but a gateway that opens up a spectrum of opportunities for the auto industry to thrive.

By capitalising on this unique advantage, Morocco has adeptly positioned itself as a central hub in the automotive sector, offering access to a vast array of markets. This strategic geographical positioning is a cornerstone of Morocco's ascendancy in becoming the pre-eminent auto manufacturing hub on the African continent, underscoring its significance in the global automotive landscape.

Favorable Economic Policies and Investment Incentives

The Moroccan government has been astutely aware of the potential economic uplift that the automotive sector could usher into the nation. In a strategic move to harness this potential, an array of favourable economic policies and enticing investment incentives have been put in place.

These policies are not just superficial lures but are deeply entrenched frameworks designed to cultivate a thriving automotive manufacturing ecosystem. Tax exemptions, significant subsidies, and a streamlined bureaucratic process offer a fertile ground for foreign automakers to plant their roots without the customary fiscal burdens or red tape that can stifle growth and innovation.

Furthermore, these incentives are tailored to bolster long-term investments and collaborations, positioning Morocco not just as a manufacturing base but as a partner in automotive excellence. This proactive approach by the Moroccan government has been pivotal in transforming the national landscape into an attractive haven for automotive giants, fostering an environment where the auto industry can flourish unencumbered by the usual constraints faced in other regions.

Robust Infrastructure and Logistics Network

Morocco's standing as a beacon of automotive manufacturing efficiency is markedly reinforced by its state-of-the-art infrastructure and comprehensive logistics network. The country is equipped with cutting-edge ports, which are amongst the most modern in Africa, ensuring that both the import of raw materials and the export of finished automobiles are conducted with the utmost efficiency.

Its railways and roadways, developed with precision engineering, span the length and breadth of the nation, facilitating an unimpeded flow of goods within Morocco and beyond its borders. This intricate network of transport modalities is pivotal in ensuring that production lines are never halted due to logistical setbacks, thereby enabling automakers to adhere to stringent delivery schedules.

Beyond mere transportation, the logistical prowess of Morocco extends into the realm of supply chain management. With advanced systems in place, the tracking, handling, and distribution of automotive components are executed with laser precision, thereby minimising wastage and optimising resource allocation.

This robust infrastructure and logistics framework not only underpins the operational excellence of Morocco's automotive sector but also serves as a magnet for global automakers in search of reliability and efficiency in their manufacturing processes. It's this seamless integration of infrastructure and logistics that fortifies Morocco’s position as a formidable contender in the global automotive arena, setting a benchmark for others to follow.

Skilled Workforce and Training Programs

A pivotal element in Morocco's rise as the automotive hub of Africa is its investment in cultivating a skilled workforce, underpinned by an emphasis on specialised training programmes.

The nation has strategically developed a network of vocational training centres and partnerships with global automotive companies, aimed at equipping its labour force with the necessary expertise to meet the demanding standards of the industry.

Renault's Tangier plant.

These programmes are not only tailored to the intricacies of automobile manufacturing but are also designed to be dynamic, evolving in tandem with the latest advancements in automotive technology and processes. As a result, Morocco boasts a pool of highly skilled technicians, engineers and workers who bring a blend of technical acumen and practical experience to the production lines.

This commitment to workforce development ensures that the country's automotive sector is powered by individuals who are not just proficient in their roles but are also innovators capable of driving efficiency and excellence. The strategic foresight in fostering such a skilled workforce serves as a linchpin in Morocco's automotive industry, enabling it to not only compete but also set new standards on the global stage.

Competitive Production Costs and Quality Standards

In the landscape of global automobile manufacturing, Morocco distinguishes itself not only through its strategic initiatives but also via its competitive edge in production costs and adherence to high-quality standards. The convergence of lower labour expenses, advantageous energy rates and reduced operating costs positions

Morocco as an appealing hub for automakers aiming to enhance their operational efficiency. This financial attractiveness is complemented by a steadfast commitment to quality. Moroccan production facilities are governed by stringent quality control measures, ensuring that each vehicle not only aligns with but often surpasses international quality benchmarks.

This meticulous attention to cost-efficiency coupled with quality excellence underscores Morocco’s capability to produce vehicles that stand up to global scrutiny, thereby cementing its status as a formidable player in the automotive domain. The synthesis of cost competitiveness and quality assurance is pivotal in Morocco’s ascension as the automotive leader in Africa, showcasing a model of manufacturing excellence that resonates on a worldwide scale.

Images: supplied (Cover image Ulli/Pixabay)

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Solar tonneau cover from Worksport ready for production

US-based company Worksport is ready to move into full production following successful testing its solar tonneau cover solution for electric trucks (bakkies), able to generate 680 W of power depending on the weather and the size of the pickup bed.

Pilot production of the Solis solar tonneau cover is currently underway at Worksport’s advanced manufacturing facility in Western New York, utilising fully tooled, production-ready components. This facility is set to become the central hub for both the Alpha phase and full-scale production of the Solis system.

The initial release of Worksport’s Solar Truck Cover and COR portable energy system is scheduled for later this summer, targeting several high-growth, billion-dollar markets.

Cutting-Edge Technology

Proudly developed in North America, the Solis system is set to redefine performance and user experience in the portable energy sector, positioning Solis as a game-changer for truck owners and the broader recreational market.

Steven Rossi, CEO of Worksport, commented: “The COR & Solis system operates as a powerful clean-tech nano grid, generating a substantial amount of power each hour. Our tests reveal that the system can charge up to 45 iPhone 14 devices per hour, delivering clean energy directly from the sun.

“The Solis tonneau cover is an ideal solution for pickup truck owners as it allows users to power campsites, tools and even appliances, effectively transforming their trucks into versatile power stations.”

Revolutionising Portable Energy

The Solis system forms a key component of the Worksport COR ecosystem. Through the integration of Worksport Solis and MPPT, optimal energy harvesting and seamless cloud integration have been successfully tested, allowing for the exchange of information via embedded power converters.

The Solis and COR systems will be paired with a state-of-the-art mobile app, offering users real-time insights into power usage and generation. This innovative approach opens up significant market opportunities for the Worksport COR ecosystem.

Rafael Oliveira, Worksport's designated CTO, stated: “By harnessing smart technology, Worksport aims to track solar power generation across all Solis covers, making this data accessible to both users and investors. This capability presents numerous benefits, including potential carbon credits, continuous feedback for our R&D, and demonstrating the exceptional energy potential of our products globally.

“The prospect of having hundreds of thousands of Solis units on roads worldwide, creating the largest portable solar microgrid network, is very real. With live data collection, we can gather invaluable insights into solar irradiance, weather conditions, and solar efficiency in various locations – and monitor our eligibility for carbon credits.”

Images: Supplied

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Shifting trends in the South African car market

The preferences for motor vehicle segments and body shapes in South Africa are undergoing significant changes, potentially marking a permanent shift. As the market grapples with new realities, even long-standing favourite brands are facing challenges.

Over the past 15 years, South Africa’s motor retail industry has been shaped by slow economic growth, inadequate infrastructure, political instability, and a series of global shocks.

"These include the 2008 financial crisis and the Covid-19 pandemic in 2020, both of which had severe economic and social impacts. More recently, Russia’s invasion of Ukraine and conflicts in the Middle East have heightened global political tensions and hindered economic activity," says Paul Marshall, managing director of Lightstone Auto which analysed the data and produced the graphs.

Globally, car sales rose to approximately 75,3 million in 2023, up from around 67,3 million in 2022. This growth reversed the declining trend seen during the economic slowdown of 2020 and 2021. Supply chain disruptions caused by Covid-19 and geopolitical conflicts led to shortages in the automotive semiconductor industry. Despite these challenges, 2023 sales exceeded pre-pandemic levels and are expected to continue rising through 2024, according to Statista.

"Both global and local factors influence consumer behaviour in South Africa, and the outlook for sales is less optimistic compared to other international markets," adds Marshall.

In 2009, South Africa recorded 393 405 new vehicle sales, the second-lowest in the past 15 years, just above the 389 205 sales in 2020 when Covid-19 struck.

Although the market recovered post-2009, reaching more than 600 000 annual sales between 2012 and 2015, consumer demand weakened before the pandemic, dropping to 536 604 in 2019. Currently, sales have rebounded to similar levels (531 787 in 2023), with further growth dependent on an improving domestic economy.

There are indications of potential interest rate relief from the South African Reserve Bank this year, although government policies may shift following the 2024 election results. Until then, consumers are likely to remain under financial pressure and continue to opt for more affordable vehicles.

Market Dynamics: Brands, Body Shapes, and Segments

Economic challenges may dampen consumer spending, but lifestyle changes and resilience are driving new purchasing trends in South Africa’s car market.

Toyota and Volkswagen remain the top brands, but the competition is heating up. Suzuki surged to third place in 2022, overtaking Hyundai, which had moved to third just a year earlier. Renault and Kia have also entered the top 10, with Renault in seventh place since 2014 and Kia in eighth since 2016. New entrants like Chery and Haval, offering more affordable options from China and South Korea, are also making their mark.

"Interestingly, BMW and Mercedes-Benz have fallen out of the top 10, and as the quality of more affordable vehicles continues to improve, these shifts could become permanent," he says.

Preferences for body shapes are also evolving. The Crossover/SUV segment, which accounted for about 13% of the market in 2009, has steadily grown to become the top choice by 2020, reaching 35% of the market in 2023.

This trend reflects consumers’ concerns about road safety and a preference for more robust vehicles that offer better protection and navigation on pothole-ridden roads. The Double Cab One-ton Pick-up has also seen consistent growth over the past 15 years, becoming the third top seller in 2023, further supporting this observation.

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Africa Automotive: Jetour likely to debut in South Africa

Jetour, a sub-brand of Chery, is believed to be about to make its debut in the South African market but not as part of Chery South Africa, rather being independently imported and distributed with its own dealer network.

Details are sketchy now, but significant considering the recent opening of the Jigjiga, Ethiopia assembly plant where Jetour is assembled. While Ethiopia is a left-hand drive market, this facility may well have the capability to assemble vehicles for other markets in Africa, including South Africa.

With battery production coming on line in Morocco, the hiatus caused by the election buildup in South Africa has further pushed back the progress that should be in full flight in terms of the country leveraging natural resources and becoming a significant finished product supplier instead of just raw materials.

Although some concessions in terms of taxes have been announced for automakers converting their facilities to manufacture or assemble electric vehicles, nothing is on the cards for embattled consumers – so the exorbitantly high cost of battery electric vehicles (BEV) is still extremely slow and limited.

However, the industry continues to move ahead in this regards and Daimler Truck recently launched electric versions of the Actros and Canter.

Africa, it self, is responding and recently Pan-Africa electric vehicles company Spiro, operating in Kenya, secured a $50-million loan from the African Export-Import Bank (Afreximbank) to expand its operations across the continent.

Spiro specialises in electric motorcycles and this latest move follows a $63-million loan from Societe Generale in August last year, aimed at expanding its presence in Togo and Benin.

Spiro, established in 2019, now manages more than 600 EV battery swapping stations in Kenya, Benin, Togo, and Rwanda. In February, Spiro revealed a partnership with oil marketing company Petrocity to set up battery swapping stations at Petrocity’s outlets, underscoring its focus on expanding in Kenya.

According to Afreximbank Executive Vice President Intra-African Trade Bank Kanayo Awan:, “The future of transportation lies in the use of electric vehicles and as demand for clean energy solutions soars, support towards companies like Spiro is crucial for accelerating the adoption of electric vehicles and reduction of carbon emissions.”

This development occurs as EV companies in Kenya and across Africa strive to secure funding through a mix of debt and equity to support their growth. EV companies have been setting up local assembly lines to meet the increasing demand for electric motorcycles, passenger cars, and buses, while also establishing charging stations in key areas of Nairobi and planning to expand to other major cities to address the lack of infrastructure, a significant barrier to the adoption of e-mobility.

However, the Kenyan government is set to present a Finance Bill that will introduce a value-added tax (VAT) on electric bikes, buses and solar and lithium-ion batteries. This proposal has raised concerns among industry stakeholders, including the Nairobi-based Associated Battery Manufacturers (ABM), who worry that the tax could substantially increase the cost of solar batteries. A 60-kilogram solar battery’s price could rise by $312 (45,000 Kenyan shillings) due to the tax.

While Kenya considers imposing an EV tax, other nations are encouraging the adoption of electric vehicles through different measures. For instance, Tunisia announced in 2023 it would offer tax breaks and purchase incentives to boost its EV sector, aiming to reach a fleet of 130 000 electric vehicles by 2030 as part of its broader environmental and energy sustainability goals.

Hugely significant is the battery swop programme. While motorcycle battery packs carry far less voltage than those in cars and trucks, the ideal electric scenario would be a safe system of ‘hot swopping’ that would allow users to get a fully-charged battery pack in around the same time as it takes to fill up at a fuel pump.

South Africa is ideally poised to be a front-runner in this and other innovations in the move to electrification but the slow responses – and often lackadaisical attitude of government means the country is falling further behind; and fast.

The slender threads holding the auto industry together are in grave danger of unravelling and all the good work done by the African Association of Automotive Manufacturers (AAAM) in conjunction with Afreximbank and via the Intra Africa Trade Shows to promote and urge Africa to adopt the AfCTA could end up being undone.

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