Dark clouds gathering for petrol attendants in South Africa
Hundreds of thousands of South African jobs are at risk as the world shifts to Electric Vehicles (EVs), including an estimated 140,000 petrol attendants.
As of 2035, the European Union will ban the import and sale of new cars with internal combustion engines (ICEs).
Although South Africa is a major exporter of ICE vehicles, the slow transition and adoption of the shift to EVs are causing concerns for the country’s motor industry—and, by extension, those who are employed within it.
Although 2035 seems far away, there is already a big shift towards electric vehicles among petrol users.
This shift puts traditional car manufacturers at a crossroads. They are torn between the necessity to innovate in the age of electric vehicles (EVs) and the need to safeguard their current products and profitability.
According to Coronation analyst Lisa Haakman, the current situation is a classic example of the ‘Innovator’s Dilemma’.
Established businesses are often slow to respond to new technologies, and delaying action can lead to disastrous consequences.
Many of today’s auto companies risk becoming obsolete if they fail to adapt, as happened to Musica, Kodak, Nokia, and Blackberry.
This poses a major threat to South Africa as the automotive sector is a significant contributor to the country’s economy and employment.
It directly employs around 110,000 people in manufacturing and assembly plants.
Moreover, the sector supports approximately 500,000 jobs when taking into account the broader automotive value chain, which includes suppliers, dealerships, and service providers.
Among these supported jobs are those of petrol attendants.
An economic bulletin published by Trade & Industrial Policy Strategies (TIPS), an economic research institution, highlighted the risks posed to this group of workers, who are largely dependent on the sale of liquid fuels.
It noted that, without adequate preparation, more than 140,000 petrol station workers stand to lose their jobs between now and the final shift to full use of electric vehicles.
However, the research paper noted that indecision still leaves the future murky.
TIPS noted that there are no clear timelines for the full-scale transition to electric vehicles, globally and locally.
“While the European Parliament approved a ban on fossil-fuel vehicles by 2035, and numerous countries, regions, and companies have committed to net zero carbon emissions by 2050, different factors make it slightly more complicated to commit to a clear (and even fixed) timeline for a shift away from liquid fuels,” it said.
For instance, in South Africa, the high cost of electric vehicles hinders greater uptake of electric vehicles.
Even if this hurdle is overcome, The economic research firm added that the question of when the last batch of internal combustion engine vehicles will be taken off the roads remains.
Supposing, for instance, that all internal combustion engine vehicles will be off the roads by 2050, the average age of vehicles on South African roads is about 11.8 years–meaning petrol stations would still need to service these remaining ICE vehicles.
Despite this, TIPS noted the climate crisis and its related impacts make it necessary for South Africa and all other countries to start taking action to reduce emissions.
This is especially important for South Africa, considering the significant contribution of the automotive value chain to the broader economy.
Furthermore, given the value chain’s impact on exports, with the majority going to the EU, a transition to electric vehicle production is essential to maintain this crucial market.
Considering this, the research paper also highlighted that if decisions and actions are taken early enough to shift towards the new motor industry era, alternative uses for petrol stations and support measures to help workers and the many communities supported by petrol station work can be found and implemented.
However, South Africa is still far behind.
China produces 68% of the world’s batteries and between 80% and 95% of the components needed to manufacture them, including the cathode, the anode, the electrolyte, and the separator.
This strategic foresight allows them to control a significant portion of the EV supply chain, making it difficult for late starts to enter the market at an affordable price.
Many Western countries and South Africa have implemented measures to protect their domestic car industries from China’s dominance in the electric vehicle market, including subsidies for non-Chinese EVs and import tariffs on Chinese-made cars.
South Africa plans to use some of the $8.8 billion in climate funding to manufacture electric vehicles.
However, critics argue that the country’s energy and logistical challenges could hinder its competitiveness in EV manufacturing.
Haakman warns that these hurdles could mean traditional car companies’ slow adoption of EVs in South Africa, which could leave them at a disadvantage and threaten jobs, potentially leading to the extinction of well-known car brands.
Read: R308 per month relief for car owners in South Africa is coming
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