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.

No 'tariffs' on our fine selection of pre-owned vehicles - click here

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.

Related Content: Losing AGOA would be a blow

Starting or running a small business and in need of a bakkie – click here

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.”

Need finance – click here for the very best finance deals for your new car

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.

Colin Windell for Colin-on-Cars in association with

proudly CHANGECARS

https://bit.ly/4iUnbIh

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.

https://bit.ly/4jcxWWi

Auto industry needs to gear up says Toyota boss

To fully cement the viability and sustainability of the South African auto industry new vehicle sales volumes need to exceed 600 000 units a year according to Andrew Kirby, President and CEO of Toyota South Africa Motors (TSAM) who made the statement at his annual State of the Motor Industry address recently – at which event Toyota also revealed six new models for launch in the first quarter.

Kirby’s, keynote address titled “The Year That Was”, offered a deep dive into the challenges and opportunities facing South Africa’s motor industry and emphasised the urgent need to boost vehicle sales to attract increased foreign investment. He also stressed the critical role of government policies noting, while recent incentives for battery electric vehicle (BEV) production were a step forward, they remain insufficient to secure the industry’s future.

Andrew Kirby

“South Africa’s automotive sector is grappling with de-industrialisation and a decline in local content, which has dropped below 40% for domestically produced vehicles,” he said. However, he maintained cautious optimism, projecting a 3,7% growth in sales for 2025, reaching 535 000 units, attributing this to potential interest rate cuts and stabilising fuel prices.

Adding to the discussion, Mikel Mabasa, CEO of NAAMSA, highlighted South Africa’s political stability as a rare advantage in the region, expressing hope for what he termed a “year of abundance.”

Emerging Automotive Trends

Kirby identified five major trends reshaping the industry:

- Shifting Consumer Preferences: South Africans are increasingly opting for smaller, more affordable vehicles, with a 2,27% drop in the average passenger car price between 2023 and 2024.
- SUV Dominance: SUVs now account for over half of passenger car sales, with the number of available models rising from 114 in 2018 to 166 in 2024.
- Demand for In-Car Technology: Features such as customisation, connectivity and voice control are becoming standard, even in entry-level models.
- Rise of Indian and Chinese Production: Chinese and Indian vehicle imports have surged, making up 37% of local sales in 2023, compared to just 18% in 2018. Meanwhile, locally produced vehicle sales have dropped from 46% to 43%.
- The NEV Transition: The adoption of hybrid and electric vehicles is gaining traction, however, widespread adoption of BEVs in South Africa is unlikely before 2029 without stronger government incentives.

The updated Toyota Corolla Cross range has been launched Click here to see our selection of pre-owned models

“The industry’s growth will depend on collaboration, adaptability and a supportive policy framework – paving the way for a brighter future in the years ahead,” he says.

Steel Woes

South Africa's automotive industry has emphasised the urgent need for a robust and sustainable local steel supply chain, citing its critical role in vehicle production, particularly in safety-critical components. Kirby expressed concern about challenges facing the steel sector, including policy issues, logistical inefficiencies, and electricity costs, all of which are contributing to rising uncertainty.

"We cannot rely on scrap metal with impurities, which some local suppliers currently provide. This makes the stability of local steel production absolutely vital for us," he says. "The recent announcement regarding the risks to Newcastle’s operations is very serious for us. It’s encouraging that open discussions are underway, and there may be positive outcomes, but the underlying challenges are clear."

Due for launch in March is the new Toyota Hilux Legend 55. Plenty of pristine pre-owned Hilux variants on offer right here

Three key issues were identified as critical to resolving the steel industry’s struggles:

- Policy Concerns: The decentralisation of scrap metal exports has created an imbalance in the local market, with industries indirectly subsidising this system.
- Transport Costs: High logistical expenses are significantly driving up the cost of steel production.
- Electricity Prices: The sector continues to grapple with exorbitant energy costs, which undermine competitiveness.

Steel constitutes approximately 25%–30% of the local content in South African-manufactured vehicles, a figure that remains constant even with the transition to battery electric vehicles (BEVs). This highlights the importance of ensuring the sustainability of the steel industry for the future of the automotive sector.

"While we acknowledge the complexity of these challenges, we believe structural issues in the steel sector must be addressed by experts in the field. As an automotive industry, we are committed to supporting and collaborating where we can guide these efforts in the right direction," added Kirby.

A meeting with the CEO of ArcelorMittal South Africa (AMSA) further underscored the importance of increasing local demand for steel. AMSA urged original equipment manufacturers (OEMs) to source more steel domestically to help stabilise and grow the sector. Out of the seven OEMs operating in South Africa, four currently source most of their steel locally, with ongoing discussions aimed at encouraging further uptake.

"We need to create an environment where local steel production is competitive and sustainable. Investment in infrastructure and achieving scale is critical, not just for the steel sector but for the broader automotive industry," he says.

Looking back, Kirby said 2024 was anticipated to follow a predictable trajectory, with a softer first half and stronger second half. However, this pattern failed to materialise. While the resolution of the energy crisis – with 300 days of uninterrupted electricity supply provided much-needed economic relief, ongoing challenges in transport and logistics hampered recovery efforts.

“The national elections also played a pivotal role. Although they concluded smoothly, pre-election tensions impacted consumer and business confidence, delaying economic recovery. By year-end, vehicle sales reached 515 000 units, falling short of the forecasted 540 000. The taxi sector’s dramatic 60% contraction, driven by fraud and financing issues, exacerbated the decline. Adjusting for this anomaly, the market would have only dropped by 1,3%.

The all-new Lexus GX, also scheduled for first-quarter release. Use our Finance Calculator to work the numbers

“The South African automotive industry remains below pre-pandemic levels, with sales still trailing 2019 figures. For sustainable growth, experts suggest the market must exceed 600 000 annual units. Falling short of this benchmark makes it difficult for the sector to achieve scale and long-term stability,” he says.

Consumer Trends: Affordability and Preference Shifts

Affordability emerged as a dominant theme in 2024. The average selling price of passenger vehicles declined, reflecting a clear shift towards more budget-friendly options, particularly in the B-segment. This trend, driven by rising economic pressures and tighter credit conditions, was also evident in increased used car sales.

SUVs and crossovers continued their meteoric rise in popularity, now accounting for 53% of passenger vehicle sales. The introduction of new models has further bolstered this segment, particularly in premium categories. Consumer preferences have also evolved, with in-car experiences such as advanced infotainment systems, connectivity, and luxury features becoming key purchase drivers, even for mid-range vehicles.

“The automotive sector faces significant structural hurdles. Despite the existence of a national automotive master plan since 2018, little progress has been made in optimising the local market. The failure to implement key elements of the plan has stifled growth, while efforts to integrate regional markets through the African Continental Free Trade Agreement remain incomplete.

“Additionally, the lack of incentives to promote new energy vehicles (NEVs) is hindering South Africa’s ability to attract investment in this area. While a new tax mechanism offers a 35% incentive for capital investment in NEVs, the local market for these vehicles remains negligible, creating a barrier to growth in domestic production and exports.”

Enhancements in order for the Lexus LX. We have some Lexus LX models on our books. Click here

Globally, Chinese and Indian vehicle manufacturers are asserting dominance, with China now accounting for 29% of global vehicle production. This trend is reshaping competition in South Africa, as both nations expand their influence in emerging markets.

At the same time, global conflicts, from the Russia-Ukraine war to Middle East tensions, have added to supply chain disruptions and market volatility. Climate-related challenges have also begun to impact South Africa, further complicating the operating environment.

“To thrive, the South African automotive industry must overcome structural inefficiencies and prioritise market integration and innovation. Affordability will remain a key factor influencing consumer behaviour, alongside a growing preference for SUVs and advanced in-car experiences.

“The sector’s future also hinges on its ability to embrace new energy vehicles, align with global trends, and secure regional trade agreements. With these measures in place, South Africa could unlock the growth potential necessary to surpass the critical 600 000-unit threshold and secure long-term sustainability.”

Vehicle Reveals

The event wasn’t just about industry insights. TSAM’s Senior Vice President for Sales and Marketing, Leon Theron, unveiled sic new models including:

- The updated Corolla Cross, featuring a refreshed design and enhanced safety features.
- The powerful Fortuner GR-S, now boasting 165kW and 550Nm of torque.
- The refined GR Yaris Upgrade, with an impressive 210kW output and a new eight-speed automatic option.
- The distinctive Hilux Legend 55, showcasing wide-body styling and performance upgrades.
- The enhanced Lexus LX and its newly introduced hybrid variant, the 700h.
- The all-new Lexus GX, a rugged yet luxurious off-roader debuting with an adventurous Overtrail variant.

Colin Windell for Colin-on-Cars in association with

proudly CHANGECARS

https://bit.ly/42Avxjb

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.

For the best value in pre-owned cars and bakkies click here

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

We have a great selection of exotic cars as well - click here

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.

For the best insurance deal click here

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.

Want to check the numbers - use our finance calculator to find your perfect deal

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

https://bit.ly/4gWA5Ej

Daimler Truck achieves production milestone

Daimler Truck Southern Africa (DTSA), the East London-based truck assembly plant, marked a significant achievement recently by officially rolling off the 800 000th Completely Knocked Down (CKD) kit from its parent factory in Woerth, Germany.

The vehicle, a Mercedes-Benz Actros 2645LS/33, emerged from the assembly line in a joint celebration with the Woerth source plant in Germany. Sesfigile Logistics and Safety One Logistics, both owned by Nelen Gounder, purchased the truck to commemorate their respective 20th and 10th anniversaries.

The Woerth plant, founded in 1963, is Mercedes-Benz Trucks’ largest truck assembly facility. Here, the Actros, Arocs, and Atego model series take shape. Additionally, Woerth produces the battery-electric Mercedes-Benz eActros 300/400 for distribution haulage, along with the eEconic electric series-production truck for municipal use. The eActros 600, designed for long-distance haulage, is set to enter series production by the end of 2024.

The East London assembly plant boasts a storied history spanning six decades. From the first Mercedes-Benz Truck in 1962 to thousands of trucks and buses today, the plant remains a cornerstone of the Buffalo City Metropolitan Municipality.

Employing around 300 people, it ranks among Daimler Truck’s largest CKD-plants outside Europe. In 2019, DTSA assembled its 750 000th CKD unit, a Mercedes-Benz Actros 2652 LS 6×4.

Gladstone Mtyoko, Vice President for Manufacturing, acknowledged the complexity of assembling products from four different source plants on a single production line. Despite this, the team consistently delivers high-quality units. The assembly of the 800 000th CKD truck stands as a proud milestone for both the Woerth and local East London plants.

Sesfigile Logistics commands a fleet of 200 trucks, specializing in beverage and petroleum transportation. Its reach spans local, national and cross-border logistics, while. Safety One Logistics, grounded in precision and efficiency, handles petroleum and specialized products with care.

https://bit.ly/4dWJjz3

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)

https://bit.ly/3AaWuxt

Africa Automotive: Doing it for ourselves

CAIRO: The African automotive sector is surging ahead with new projects and new plans for both assembly and the manufacture of parts to feed what is hoped will become a voracious beast – provided even more cooperation and support can be gained from governments across the continent.

Steady progress towards realising an African Free Trade Agreement (AfCFTA) is being made with countries such as Nigeria, Ghana, Kenya, Morocco and Egypt fully committed to making it work while, simultaneously, energising their own auto programmes.

The President of the African Association of Automotive Manufacturers (AAAM) and Managing Director of Volkswagen South Africa, Martina Biene, said at the opening of the Africa Automotive Show in Cairo: “There are multiple opportunities for everyone in Africa to be a part of the combined value chain.

Martina Biene

“A comprehensive automotive policy creates the framework for trade and will build new car demand but remains dependent on economies of scale and any policy framework must serve to increase that demand.”

Presenting the results of a ‘roadmap’ study done in Egypt on powertrain evolution, Dylan Jessup, Automotive Sector Incentives Manager at EY South Africa, said battery electric vehicles (BEV) was “not the panacea” and that each segment in the possible alternative power source options needed to be evaluated separately and specifically for each country to “determine economic, environmental and social benefits”.

“South Africa’s auto industry is very built on a trade based policy but we need to look at regional integration and establish a healthy supply chain (that could involve beneficiating the raw materials mined in various countries rather than sending them away only to be re-imported).

“Each country needs to look at it strengths and work on those and the actual implementation of the AfCFTA will then make trade easier.”

Of the issues demanding urgent attention is the one on fuel quality with much of Africa still running Euro II specification whereas Europe is moving to Euro VII.

Rynhardt Rall, Regional Product Manager for Nissan pointed out the automaker had two plants in Africa – South Africa and Egypt – saying: “It is very expensive to run internal combustion engine (ICE) vehicles on Euro VII fuel but Africa does not need to go head-to-head or play catchup.

“Africa is rich in natural resources so it makes good sense to utilise that,” he says.

Biene concurred and added the low level fuel meant Volkswagen could not introduce some of its latest generation hybrid vehicles that simply could not run on Euro II fuel.

“The South African government has to become more pro-active on this issue.”

The Intra Africa Trade Fair (IATF) is a massive multi-cultural event covering many aspects of trade and industry and, while a large and very significant element, the Auto Show is just a part of an entity where deals worth billions of Dollars are being done by Africans for Africans.

In a keynote speech read on his behalf, Morocco’s King Mohammed VI said: “Africa needs now more than ever bold, innovative initiatives to encourage private entrepreneurship and unleash the full potential of our continent.

“Over the past two decades, Morocco has made infrastructure development a priority in all economic sectors and is pushing toward its goal of deriving more than 52% of its national electricity mix from renewable energy by 2030.”

The King also stressed African countries should enhance “coordination and cooperation mechanisms to drive regional integration”,  citing the Morocco-Nigeria Gas Pipeline Project he says will “enable all countries along the pipeline route to have access to reliable energy supplies and to be more resilient to exogenous energy price shocks”.

There is a slender thread that links all of the different activities and interests at IATF and literary superstar Chimamanda Ngozi Adichie and Narrative Landscape Press announced the launch of The CANEX Prize for Publishing in Africa.

Why does this matter?

“Stories can give us the confidence to own our aspirations,” says the writer. “CANEX is about hope – the hope of many more African stories. We need more African countries. Stories matter. Stories can take away dignity, but they can also restore dignity. Stories shape politics and perceptions.”

And that is the thread – reshaping politics and perception to benefit all Africans – and in his keynote address, Dr Akinwumi A Adesina, President of the African Development Bank Group, highlighted Africa’s prospects as a prime investment destination.

“The continent is not as risky as perceived, is growing and showing resilience despite global challenges. As investors, put your monies where the future is — the future is Africa.”

Part of the South Africa Pavilion at IATF

The President of Comoros, Azali Assoumani, pointed out manufactured African exports account for just 1% of world exports.

“We export them to developed countries and these countries re-export them to us processed and sell them back to us at ten times the price. Despite the obstacles, there are enormous opportunities for the development of value chains in Africa.”

Alec Erwin, former Minister of Trade and Industry now a driving force in the efforts of AAAM remarked the early 90’s in South Africa brought new challenges and the realisation the economy had to grow.

“Simply put, South Africa’s auto industry could not survive the way it was and that led to it changing to a volume production scenario which it managed very successfully. For Africa a similar system is needed that will let us all grow and, while there may be some policy differences, it will all be based on trade – and that is why AfCFTA is so vitally important.”

In a video address Anand Pather, Vice President Customer Services at Toyota South Africa, said: “Africa needs a comprehensive safety policy across the auto industry, something like the South African Bureau of Standards that will oversee all of the parts supply chain to ensure equal and high standards are maintained.”

If some of what AAAM and various African governments are talking about seems a bit ‘pie-in-the-sky’, think on this – the Start/Stop button so common in cars today started life as an Egyptian patent.

Colin Windell – proudly CHANGECARS

https://bit.ly/47qlLza

Africa Automotive - All go for Cairo

As Egypt and, more specifically, Cairo gears up to host the Africa Automotive Show as part of the week-long Intra Africa Trade Fair, the country is also celebrating being ranked 28th in a global e-mobility index regarding the preparedness of the country is to transition to electric vehicles (EVs), and was categorized as a starter market after scoring 32 points out of 100.

Out of 35 countries studied in the new Global Electric Mobility Readiness Index (GEMRIX) 2023 by US consulting firm Arthur D Little, 13 countries from the MENA region were included, with Egypt ranked 10th in the Middle East.

“Despite the relatively low presence of EVs, the Egyptian government has been expressing strong ambitions to push for the promotion of EVs. A key reason for this ambition is the government’s commitment to achieving its sustainable development goals, which are elaborated in Egypt Vision 2030,” said the report – and this as South Africa still awaits clarity of the ANV Government as what it plans for the future.

According to the report, a starter market is one with a strong potential for new start-up-style entrants and early infrastructure development in a “blue ocean environment.”

It also noted that many of these markets would have some progress in establishing local EV manufacturers and an EV ecosystem.

In much the same time frame the Africa Association of Automotive Manufacturers (AAAM) announced Volkswagen’s Martina Biene is taking over the role of President from newly-named head of Stellantis South Africa, Mike Whitfield.

Martina Biene

Her goal – to play a “key role through AAAM to grow the automotive manufacturing industry from the 1,1-million vehicles a year today to 3,5-million or even 5-million by the year 2035”.

The AAAM was founded in November 2015 and is the only African entity with a focus on both widening and deepening the automotive industry across the continent by working with governments to develop investor-friendly policies as well as seeking to align a global stakeholder network, to free up Africa’s economic potential, via the automotive sector.

As the large South African of delegates and exhibitors heads for Cairo, it is with the hope the electric vehicle strategy for the country will have been outlined and, as Billy Tom, naamsa President and CEO of Isuzu Motors South Africa said recently: “As an industry reliant on exports to markets such as Europe, which has shifted away from ICE vehicles, we have to be able to adapt and meet these stringent demands to continue delivering vehicles there and to other similar markets.”

Colin Windell – proudly CHANGECARS

https://bit.ly/40fgmJ1

Egypt licenses local electric car factory to start production by end of 2024 - Economy - Business

The Egyptian Cabinet agreed to grant the golden licence to private company EgyptSat Auto to build and operate a factory that will begin producing electric vehicles (EVs) by the end of 2024.


Source: Egypt licenses local electric car factory to start production by end of 2024 - Economy - Business
https://bit.ly/3ZplVnD

Africa Automotive - The clock is ticking

As the clock counts down to the Intra Africa Trade Fair (IATF) taking place in Cairo, Egypt in November, the pace of African automotive development is picking up pace. . .rapidly.  

In new recent developments, Chinese automaker BYD – which recently launched in South Africa – announced its launch plans in Morocco in an alliance with Auto Nejma, a key player in automobile distribution in Morocco.  

Still in Morocco – The Minister of Industry and Trade, Ryad Mezzour, and Frank Huber, Forvia Group’s Executive Vice-President of Seating, recently launched the construction of the group’s new production facility in Sale near Rabat.  

The new industrial plant, which will expand the Group's industrial activity in Morocco, will specialise in the cutting and production of textile and leather covers for automotiveseats, to meet the demand of numerous European automakers.  

The equipment manufacturer will invest $15,4-million in this industrial initiative, which will generate 1 400 new jobs.   

“This fourth Faurecia plant reinforces our positioning as a destination of choice for investment in the automotive sector. It is a clear sign of the confidence of renowned players in our industrial potential and assets,” Mezzour says, adding, “this project will bring an added value to the Rabat-Sale-Kenitra region, reinforcing its position as a benchmark industrial hub in the automotive industry.” 

“We've been present in Morocco for nearly fifteen years, and we're delighted to open a new chapter in this country, where we already employ nearly 4 000 people, by expanding our plant in Sale,” Hubert stated.   “Morocco has seen significant growth in the automotive sector in recent years. We are delighted to be strengthening our position in this ecosystem today, and would also like to thank the local authorities for their support from the outset of this project,” he added.  

Since 2008, Faurecia, a Forvia Group company and the world's 7th largest automotive technology company has had three production facilities in Morocco: two in Kenitra and one in Sale.  

Algerian Trade and Export Promotion Minister, Tayeb Zitouni, recently announced China has agreed to build an automobile factory in Algeria and Yazaki, a Japanese car parts supplier, has signed an agreement with the Governor of Fayoum in Egypt to allocate land for a new factory that will be constructed by the company's local subsidiary using $33,27-million in investments. 

Although South Africa remains the largest automobile manufacturing country in Africa, the gap is narrowing and particularly in the establishment of investment in the supply chain sector.  

A quick snapshot of some of the activity around Africa shows:  

Ghana: Kantanka Automobile Company: Founded by Kwadwo Safo Kantanka, this indigenous automaker has been producing vehicles since the early 1990s. Kantanka’s production facilities in Ghana assemble a range of vehicles, including sedans, SUVs, pickups, and luxury cars. The company focuses on designing and manufacturing vehicles that cater to the specific needs of the African market.

Nigeria: Innoson Vehicle Manufacturing (IVM): Innoson Vehicle Manufacturing (IVM), founded by Innocent Chukwuma, is a leading player in Nigeria’s automotive sector. IVM has established a modern production facility in the city of Nnewi, where it assembles a diverse range of vehicles, including cars, buses, and trucks.

Kenya: Mobius Motors: Mobius Motors, headquartered in Nairobi, is a notable example of Kenya’s commitment to producing vehicles that meet local transportation challenges. The company focuses on creating affordable and rugged vehicles designed for African road conditions and transportation needs. 

The African Automotive Show runs concurrently with IATF2023 from November 9 to November 15 and, based on figures from the last IATF, held in Durban, could generate more than R840-billion in trade deals.  

Besides the 1 600 exhibitors, 79 countries and 35 000 attendees that will be participating at the event, here are another nine reasons you need to register today.  

Automotive companies including commercial (bus and truck) and passenger vehicle manufacturers, assemblers, importers, component manufacturers, dealers, parts & accessories distributors, electric motorcycles and vehicles, infrastructural projects and agencies, other members of the value-chain, including mineral processing, logistic services providers and automotive development agencies will have an opportunity to showcase their products and also interact with potential buyers, suppliers and governments.

The Automotive Forum (conference), spearheaded by the African Association of Automotive Manufacturers (AAAM) addresses the most pertinent issues affecting Africa’s automotive growth. Highlights of the 3-day program include:

- Presentations from global automotive leaders, including multi-national OEMs

- Participation of several Heads of State

- An agenda that seeks to facilitate cooperation and the development of regional auto supply chains (trade between auto hubs) for auto manufacturing on the continent.

- Unprecedented networking with all of Africa’s key role-players and international partners.

A B2B and B2G platform: The platform will provide matchmaking and business exchange opportunities for vehicle manufacturers, vehicle assemblers, OEMs and component suppliers and other automotive industry service providers, leading to the conclusion of business and investment deals across various sectors.

This is supported by a dedicated African Buyers' Programme  Africa (excluding South Africa) currently accounts for only 0,5% of the global automotive market (600 000 units). Its motorisation rate is just 45 vehicles per 1 000 inhabitants - significantly below the global average of 203.   The exhibition will attract continental and global buyers and sellers, including executives and market expansion managers that will engage in business deals in, amongst others:

- Parts Manufacturing, including EV components, batteries and solar

- Raw Materials

- Parts Supply

- Parts Distribution

- Vehicle Manufacturing

- Component Manufacturers

- Vehicle Aftermarket Services

- Logistics Service Providers

- Infrastructural Projects e.g. Special Economic Zones

- Vehicle Accessories:

- Vehicle Electronics

- Vehicle Security

- Vehicle Maintenance

- Electric Vehicle Supply

- Electric Vehicle Accessories

- Vehicle Finance (Including Insurance)

  While challenges exist, the potential impact of a flourishing automotive sector is immense. The growth of the industry can drive economic development, create jobs, facilitate technology transfer and meet the unique transportation needs of African consumers.  

https://bit.ly/3DDxFZG

Africa Automotive - Cairo is a go

The Automotive Expo and Forum is a go for 2023 at the Egypt International Convention Centre in Cairo – this follows a venue change from the original Abidjan site.

As part of the Intra Africa Trade Fair 2023, the Automotive Expo, hosted by the African Association of Automotive Manufacturers (AAAM) gains feature status this year within the fair that runs from November 9 to November 15.

Fully backed by the Department of Trade and Industry in South Africa, many local automakers and assemblers are expected to be visible in Cairo along with a strong showing from assemblers in other African countries such as Morocco.

Indeed, automotive interest and passion at all levels is becoming increasingly evident in the investment plans already in place, or being put into place, in various African countries and, perhaps, is highlighted by the news Kenya will be staging an auto show in September.

This will run from September 15 to September 17 at, the Sarit Centre Expo Hall in Nairobi and aims to attract new partners and players in the automotive and associated industries.

The Motorshow's theme this year is ‘The Connection,’ emphasising the seamless integration of automotive technology with our daily lives and the endless possibilities it brings.

The organisers expect 10 000 attendees and the title sponsor is NCBA Bank whose Group Managing Director, John Gachora, says: "As the leaders in asset financing in Kenya and East Africa, we are dedicated to creating sustainable transport options by providing affordable financing solutions."

https://bit.ly/441hbpR

Africa Automotive - Call to share technology

A recent call by the Arab parliament for Morocco to share its experience and know-how in the automobile industry confirms African countries' accelerating desire to become active players in this ever-growing sector with their own facilities.

Morocco is gearing up to produce 2-million cars a year and the automotive manufacturing scene in Morocco has experienced significant growth and development in recent years.

The country has become an attractive destination for automotive manufacturing due to its strategic geographic location, favourable business environment, and government support.

Morocco's automotive industry has been bolstered by the establishment of several major automotive manufacturing plants, both by international companies and local manufacturers. Some notable companies that have set up production facilities in Morocco include Renault, PSA Group (Peugeot-Citroën), and Ford.

These companies have invested heavily in the country, creating job opportunities and contributing to economic growth.

Incentives

Morocco has actively pursued policies to attract automotive manufacturers, offering various incentives such as tax breaks, investment subsidies, and a skilled labour force. The government has also invested in infrastructure development, including the construction of industrial parks and specialized training centres for automotive manufacturing.

The country's automotive manufacturing sector primarily focuses on vehicle assembly, although there has been an increasing emphasis on developing local supply chains and promoting the production of components and parts within Morocco. This localization strategy aims to enhance the country's competitiveness and reduce dependence on imported components.

In terms of technology, Morocco has made strides in adopting advanced manufacturing processes and digitalization in its automotive industry. Many manufacturers have implemented Industry 4.0 technologies such as robotics, automation, and data analytics to improve efficiency and productivity.

Research

The government has also emphasized the importance of research and development (R&D) in the automotive sector, encouraging collaboration between industry players and academic institutions.

As for offering technology to other countries, Morocco can indeed leverage its automotive manufacturing capabilities and expertise to expand its international footprint. By exporting technology and sharing best practices, Morocco can enhance its reputation as a reliable and competitive player in the global automotive industry. This can lead to further investment, job creation, and economic growth.

Moreover, technology transfer can facilitate knowledge exchange and collaboration between Morocco and other countries, fostering innovation and mutual development. It can also open up new avenues for partnerships and joint ventures, benefiting both Moroccan companies and their international counterparts.

Morocco recently lifted the curtain on two prototypes made by Moroccans in the field of the automotive sector. The first was a conventional car targeting the wider public named ‘Neo Motors’ and the second was a forward-looking hydrogen-powered car.

https://bit.ly/3MA5Qpa

Africa Automotive - Volkswagen supports Africa growth

Volkswagen is fully supportive of growth in the automotive industry in Africa, having taken over the assembly responsibilities of the plant in Ghana from its licenced importer, Universal Motors Limited.

The Africa Union commemorates it 60th anniversary this year on Africa Day with the slogan ‘Our Africa, Our Future’ and this slogan resonates strongly with Volkswagen as the company continues to grow its presence on the continent.

Ghana is the fourth Volkswagen assembly location in Sub-Saharan Africa after Kenya, Rwanda and South Africa, where Volkswagen has been manufacturing vehicles for more than 72 years.

Volkswagen Group South Africa (VWSA) Chairperson and Managing Director, Martina Biene, is positive about Africa’s growth potential, saying a number of African countries have introduced compelling incentive plans for locally assembled vehicles to attract OEMs such as Volkswagen to invest in the development of the automotive industry on the continent.

From left Volkswagen Ghana Chief Executive Officer, Jeffrey Peprah, Martina Biene, Chairperson and MD of Volkswagen Group South Africa, Andrew Potgieter, VWSA advisor to Ghana, Ulrich Schwabe, VWSA Production Director and Thomas Milz VWSA Sales and Marketing Director at the recent Ghana plant opening.

“We are encouraged by the automotive policy changes which some of the countries have implemented or in the process of implementing. These policies will help us to sell new high-quality vehicles which are backed by a well-established global brand to our African customers,” said Biene.

Biene added Sub-Saharan Africa has become very important for the sustainability of Volkswagen.

Future

“The future of Volkswagen is in Africa. We are therefore accelerating our growth strategy on the continent by playing a pioneering and leading role in the development of the automotive industry.”

Volkswagen already has a presence in 17 countries in Sub-Saharan Africa where it sells passenger and commercial vehicles through licensed importers.

“We will continue to grow the Volkswagen brand in these markets and strengthen our aftersales support to customers. Ongoing training is provided to technical staff at the Volkswagen locations to meet customer requirements and expectations,” Biene added.

Growing

According to the African Development Bank of the world’s 10 fastest growing economies, five are in Africa - Rwanda, Côte d’Ivoire, Benin, Ethiopia and Tanzania.

Biene affirmed Rwanda and Côte d’Ivoire are also two of Volkswagen’s fastest-growing markets. Rwanda, with an economy growing at close to 8%, shows significant potential for increased mobility solutions and electric vehicles due to its relatively young, tech-savvy population and growing middle class.

“Rwanda has been the success story of our growth plans in Sub-Saharan Africa. It is also the innovation hub of our sustainable mobility lighthouse projects on the continent. Our mobility solutions services business, which includes ride-hailing and corporate car sharing, broke even last year. Rwanda was also the first country in Sub-Saharan Africa to launch a Volkswagen electric vehicle with the e-Golfs,” concluded Biene. 

https://bit.ly/3OECKYs

Africa Automotive - Electric deals for Cairo

Stellantis, the global auto giant formed out of the merger between the PSA Peugeot Citroën Group and Fiat Chrysler, is to spend around $35-billion to build a factory in Cairo for the manufacture and export of electric vehicles by 2025, while Ashok Leyland from India is also looking to Cairo as a market for its buses.

The Ashok Leyland venture comes with the signing of a joint venture deal with Egyptian car manufacturer El Nasr Automotive Manufacturing and, initially, will extend and modernise an El Nasr factory in Cairo that will produce trucks, vans, pick-ups and buses in all-electric mode.

Ashok Leyland is looking to see its range of ‘circuit’ buses moving about African roads – this vehicle with artificial intelligence (AI) needs a single daily charge to travel up to 120 kilometres.

In recent years, the global automotive industry has witnessed a significant shift towards sustainable transportation solutions, with electric vehicles (EVs) emerging as a promising alternative to traditional fossil fuel-powered cars.

While the adoption of EVs has gained momentum in many parts of the world, Africa, with its unique set of challenges and opportunities, is gradually making progress in embracing this transformative technology. This article delves into the advancements of electric vehicles in Africa, exploring the driving forces behind their growth, notable initiatives, and the potential impact on the continent's sustainable development.

Challenges and Opportunities

Africa faces several challenges when it comes to the widespread adoption of electric vehicles. These challenges include limited charging infrastructure, high upfront costs, inadequate access to electricity, and concerns about range anxiety.

However, amidst these challenges lie opportunities that can be leveraged to accelerate the growth of EVs. Africa's abundant renewable energy resources, such as solar and wind, present an ideal foundation for sustainable charging infrastructure. Additionally, the continent's rising middle class, urbanisation trends, and the need for cleaner transportation solutions create a fertile ground for EV market growth.

Public-private partnerships and investments play a crucial role in driving the progress of electric vehicles in Africa. International organisations, development banks, and private companies have recognised the potential of the African market and are investing in various EV-related initiatives.

For example, the African Development Bank launched the ‘Green Mini-Grid Market Development Program’ to support the deployment of off-grid renewable energy systems, including solar-powered charging stations. Companies such as Tesla, BYD, and Nissan have also shown interest in expanding their presence in Africa, either through partnerships or direct investments.

Public transportation represents a significant opportunity for electric vehicle adoption in Africa. Many African cities are characterised by congested roads and poor air quality, making the transition to electric buses a viable solution.

https://bit.ly/435QmjX

Colin-on-Cars - Nissan taps into Africa

Nissan Africa has revised its management structure to strengthen its foray into the African auto market.

“These are clear signals of the importance of Africa to Nissan globally through this new increased focus on the continent” says Joni Paiva who was newly appointed as Africa President. Paiva will also continue his current position as Divisional Vice President, overseeing Sales and Marketing, India.

Sherief Eldessouky has been appointed Managing Director of Nissan Africa with effect from April 1, 2023, replacing Mike Whitfield, who will now become the Group Strategic Advisor for Policies, Political Affairs and External Relations.

Sherief Eldessouky

“I am thrilled about this opportunity, I have been given,” says Whitfield who established Nissan Africa as a regional business unit in 2020 “Africa is a key market with an unmatched growth potential and the way we unlock that will be through a combination of intelligent mobility solutions and creating a coalition of willing countries to develop a thriving and sustainable automotive manufacturing industry.

Mike Whitfield

Eldessouky, who previously combined the twin roles of being Nissan Egypt country director and driving the transformation of Nissan Africa, has spent his life in the automotive industry in a career that has taken him from his native Egypt to Brazil, China, Korea, the United States and Uzbekistan, among others.

He joined Nissan in 2020 as head of the OEM’s automotive manufacturing operation in Egypt and was appointed country director at the end of that year.

“Nissan is well positioned on the continent, with an incredible legacy,” says Eldessouky, our job as a management team has been to establish just how we bring more wealth and value to a region with promising automotive growth opportunities with its rate of 42 vehicles per 1 000 compared to the global average of 182.”

Joni Paiva

“I am confident that with the team we have in Africa and the support that we get from our Nissan colleagues in the rest of the world, that we will achieve this.”

The position of country director Nissan Egypt will be filled by Mohamed Samad, who will return to Cairo from Japan where he has been based. Kabelo Rabotho remains country director for Nissan South Africa.

Maciej Klenkiewicz, currently Managing Director RBU Central Eastern Europe (CEE) will expand current scope to include Independent Markets Africa, making the most of his previous ASEAN importer management experience replacing Hide Kuwayama who is assuming a new position in Nissan’s global headquarters.

“These are exciting times for Nissan Africa,” says Paiva. “We have a very strong management team in place to drive the medium-term plan of ‘Let’s Build’ and to deliver the mobility solutions that Africa needs.”

The appointment are the latest iterations in a raft of changes and consolidations, which have seen Nissan Africa take responsibility for the North African territories of Algeria, Morocco and Tunisia last year.

Visitors and delegates to the Africa Automotive Show and the Intra Africa Trade Fair in Abidjan in November will be able to hear about the full spectrum of growth within Africa of the auto industry, both in terms of sales and manufacturing or assembly.

https://bit.ly/3U75Lgb

Colin-on-Cars - First Ranger off the line

After months of build-up news, a factory ‘unveiling’ and more than plenty hype, Ford Motor Company’s Silverton Assembly Plant in Pretoria, today became the third plant to commence production of the new Ranger for customers around the world.

The start of the production follows a major investment of US$1,05-billion (R15,8 billion) in Ford’s South African operations and supplier tooling to allow exports to more than 100 markets, including Europe.

Ford Motor Company now has three production hubs in the International Markets Group (IMG) region producing Next-Gen Ranger for global markets, including the Silverton plant in South Africa, and two plants in Thailand. The company also has CKD operations in Vietnam and Cambodia to assemble the Ranger, with plants in the US and Argentina to begin production in 2023.

Commitment

“The start of Ranger production in South Africa highlights our commitment to delivering must-have products for our customers, not just in South Africa but around the world,” says Dianne Craig, president of Ford International Markets Group (IMG).

“South Africa is an important part of our global Ranger manufacturing network, and it is fantastic to witness the investment being utilised to modernise and transform the Silverton Assembly Plant to produce vehicles of the absolute best quality for customers around the world.”

The expanded operations in South Africa contribute to job creation and economic development, with 1 200 new jobs added for a third shift to support the increased production volumes. This takes the workforce at Ford South Africa to 5 500 employees. Ford’s supplier network benefits too, with approximately 10 000 jobs added across the value chain.

Of the total investment, approximately US$686-million (R10,3 billion) has gone into the transformation and modernisation of the Silverton plant with the construction of its first on-site Stamping Plant, a new highly automated Body Shop, and the introduction of the latest vehicle assembly operations on the Trim, Chassis and Final line.

Furthermore, the only Ford-owned and operated Frame Line in the world was built in the new Tshwane Automotive Special Economic Zone (TASEZ) supplier park adjacent to the Silverton Assembly Plant. Ford’s investment in tooling at its major supplier companies totalled US$365-million (R5,5-billion).

In addition to the Silverton investment, Ford injected US$34-million (R600-million) into its Struandale Engine Plant in Gqeberha (formerly Port Elizabeth), which produces all the engines used in the new Ranger.

The investment in Struandale Engine Plant has helped Ford introduce the new 3,0-litre V6 Diesel engine program, comprising cylinder head machining and engine assembly. Upgrades for the Ranger were also implemented on the existing assembly line for the 2,0-litre Single Turbo and 2,0-litre B-Turbo diesel engines.

“We have put immense effort, resources, and the latest technologies in place to ensure the Ranger is truly world-class, and that the Silverton plant globally equals the very best,” says Andrea Cavallaro, Director Operations, Ford IMG.

“We took several strategic decisions including the decision to bring the stamping operations and the frame manufacturing in-house, to ensure complete control of the production quality. The process put in today guarantees that the components going onto the assembly line for every Next-Gen Ranger are of the highest quality.”

The Stamping Plant at the Silverton Assembly Plant is in a new 10 320 m2 facility and feeds stamped body panels directly to the adjacent and completely new 44 000 m2 Body Shop, which is highly automated with approximately 493 robots.

Technologies

“To meet our volume and quality objectives, we have the world’s only Ford-owned and operated chassis manufacturing plant at the Silverton plant that uses the most advanced technologies currently available,” Cavallaro added.  

In addition, the 100 000 m2 Frame Line in the Tshwane Automotive Special Economic Zone (TASEZ) supplier park, located next door to the Silverton Assembly Plant, ensures the seamless sequencing of parts directly to the assembly line.

First launched in 2011, the Ranger remained one of the leading contenders in the local market over the ensuing 11 years, earning a long list of accolades in the process.

“The success of the Ranger globally establishes it as one of Ford’s most important nameplates sold in every continent,” said Neale Hill, President, Ford Motor Company Africa. “The Next-Gen Ranger is sure to raise the bar yet again and with the start of production in the Silverton assembly plant, South Africa is proud to play a role in its growth.”

What now remains to be seen is if Ford South Africa will continue to build a range of the older version to service its large corporate market.

To my mind this is a no-brainer, especially considering the final few months of production of the outgoing model were done on the new Ranger line as a kind of tesdt bed production – so there is no reason why both cannot co-exist.

First Ranger off the line: https://www.youtube.com/watch?v=wD3xnh7cHsE

https://bit.ly/3tzpLeP