South Africa risks losing the bulk of its automotive exports unless the government implements policies to create an electric-vehicle manufacturing industry, according to Nissan Motor’s Africa head.<\/p>\n
Europe is the destination for about two-thirds of car exports from South Africa, which earned R202 billion ($14 billion) from sending vehicles and components internationally in 2019.<\/p>\n
But with countries such as Germany moving toward mandating the use of cleaner cars, South Africa risks being left behind, Mike Whitfield, Nissan Africa\u2019s managing director, said in an interview.<\/p>\n
\u201cA very large percentage of our exports as an industry go to Europe, and while Europe is moving aggressively to electric, we are not,\u201d said Whitfield, who is also president of the\u00a0African Association of Automotive Manufacturers. \u201cWe are going to progressively lose our potential markets.\u201d<\/p>\n
South Africa relies on the automotive industry for about 15% of its exports, and has lured major manufacturers such as Toyota Motor and Volkswagen with a government incentive plan\u00a0to set up local plants.<\/p>\n
Yet the country remains a long way off introducing electric vehicles to its roads on any significant scale. While traditional gas and diesel-fueled cars can be imported for free, EVs attract a duty of as much as 25% and there are few charging stations.<\/p>\n
\u201cYou are not going to get industrialization of electric vehicles unless you\u2019ve got demand,\u201d Whitfield said. \u201cWe need the charging infrastructure\u201d and incentives to buy, he said.<\/p>\n
The rest of Africa has also been slow to foster production, including in carmaking strongholds such as Egypt and Morocco, he said.<\/p>\n
African potential<\/strong><\/p>\n One cause for optimism in Africa is that new car sales are expected to grow to as many as 5 million a year in 2035 from 1.2 million, and that could compensate for declines in the European export market, he said.<\/p>\n \u201cThe intention is to transition and keep the market in Europe, which obviously requires investment and some changes in policy and approach,\u201d Whitfield said. \u201cAdd to that the potential of the African market.\u201d<\/p>\n Nissan this month opened an assembly plant in Ghana, with components supplied by plants in South Africa, and is considering entering East Africa with a partner, he said.<\/p>\n Nigeria — Africa\u2019s most populous nation with more than 200 million people — isn\u2019t likely to contribute to growth of the continent-wide market due to the mass import of used cars. An automotive policy that included duties on second-hand vehicles was never fully implemented and new car sales have plunged to as little as 10,000 a year.<\/p>\n \u201cWe\u2019ve got to keep addressing affordability,\u201d Whitfield said. \u201cRight now used vehicles fulfill that role.\u201d<\/p>\n
\n