South Africa expects efforts to boost its electric vehicle (EV) manufacturing to yield swift results as manufacturers start to take advantage of tax incentives from early 2026.<\/p>\n\n\n\n
\u201cWe are ready now for carmakers to begin to gear up,\u201d Trade and Industry Minister Ebrahim Patel told reporters. <\/p>\n\n\n\n
\u201cA carmaker can commence immediately to put in place the production capabilities and production systems<\/strong>,\u201d he said Monday on the sidelines of a Black Industrialists and Exporters Conference in the capital, Pretoria.<\/p>\n\n\n\n South Africa, in an effort to preserve a key export industry, last month announced a 150% tax deduction on investments in the local production of electric and hydrogen-powered vehicles from March 2026.<\/p>\n\n\n\n The country\u2019s vehicle exports generated more than $21 billion in earnings last year. <\/p>\n\n\n\n But car companies were worried about the lack of government support for EVs amid shrinking demand for conventional petrol and diesel-powered engines in Europe, South Africa\u2019s primary export market.<\/p>\n\n\n\n Patel said the long lead time was designed to give South African carmakers enough time to prepare production facilities and win support from their parent companies.<\/p>\n\n\n\n \u201cAs they incur that expense off the back of our incentive, they know they will be reimbursed,\u201d he said.<\/p>\n\n\n\n The tax break is key for South Africa, which despite its natural advantages, has done little to develop an EV industry in the country.<\/p>\n\n\n\n South Africa has abundant supplies of raw materials vital for the manufacture of lithium-ion batteries, including increasing supplies of nickel and the world\u2019s largest reserves of manganese. <\/p>\n\n\n\n It also holds the world\u2019s largest platinum reserves, a metal used in fuel-cell engines that run on hydrogen.<\/p>\n\n\n\n
\n\n\n\n