Mahindra is boosting capacity at its South Africa plant by two-thirds as India\u2019s largest automaker by value seeks to capitalize on the demand for lower-cost vehicles in the continent\u2019s biggest economy.\u00a0<\/p>\n\n\n\n
The company, which makes the Mahindra Pik-Up brand at its assembly plant near Durban, will boost capacity to 1,500 vehicles a month from 900, Rajesh Gupta, chief executive officer of the local unit said.<\/p>\n\n\n\n
The company is also considering assembling other models locally, he said.<\/p>\n\n\n\n
Sluggish growth in the continent\u2019s most-industrialized nation has seen South Africans demand more economical cars. <\/p>\n\n\n\n
Sales of Mahindra, Suzuki and China\u2019s Chery have jumped, while those of Mercedes-Benz and BMW plunged or stagnated.<\/p>\n\n\n\n
In 2014, luxury brands such as Audi, BMW, Mini, and Mercedes-Benz collectively sold around 74,015 vehicles in South Africa.<\/p>\n\n\n\n
As of the end of 2024, this number had dropped to 23,881. This translates to a 68% drop in sales\u2014highlighting the stagging amount of South Africans who no longer see these vehicles as an option.<\/p>\n\n\n\n
The biggest loser was Mercedes-Benz, dropping 82% to 5,048 sold units in 2024 from 28,99 in 2014. This was followed by Audi (-70%) and then BMW and Mini (-50%).<\/p>\n\n\n\n
In contrast, vehicles from Asia\u2014such as Chery, Haval, and Suzuki\u2014have seen massive growth over the same period.<\/p>\n\n\n\n
The average selling price of cars has dropped 2.3% in the two years to 2025 to R490,478, according to Toyota, South Africa\u2019s most popular auto brand. <\/p>\n\n\n\n
Annual inflation averaged about 4.5% over the same period.<\/p>\n\n\n\n
The pick-ups assembled in Mahindra\u2019s Durban plant, which opened in 2018, have become popular with local farmers. <\/p>\n\n\n\n
They\u2019re also used by the police in neighboring Mozambique. The company also sells other sports utility vehicles in South Africa including the XUV 3XO, XUV 700, Scorpio-N and Bolero.<\/p>\n\n\n\n
Mahindra\u2019s expansion is a rare bit of good news for President Cyril Ramaphosa as his government struggles to reduce the fallout from US President Donald Trump\u2019s 30% tariffs, with the auto and agricultural exports exposed to the biggest hit. <\/p>\n\n\n\n The rise in the mid-market segment has even lured Tata Motors. India\u2019s largest auto maker by sales has tied up with Motus Holdings to distribute its vehicles in the African nation, according to the South African car retailer.<\/p>\n\n\n\n![\"\"](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2025\/08\/Economical-cars-Bloomberg.jpg\")
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