Cape Town - As the momentum for electric vehicles (EVs) builds with some of South Africa’s biggest markets phasing out internal combustion engine (ICE) vehicles in favour of EV as soon as 2030, there are rising fears that the country is falling far behind, having barely started producing these vehicles.
Stakeholders said this could have a catastrophic impact on the vehicle production industry and its ability to export vehicles, especially as there were about 500000 jobs that depend on this industry.
GreenCape’s 2022 Electric Vehicles Market Intelligence Report stated that a thriving EV market in South Africa, supported by local manufacturing, held the promise of sustainable economic development and increased economic resilience to the economic impacts of climate change mitigation measures by counteracting the inevitable decline in demand for Internal Combustion Engine (ICE) vehicles globally.
Stellenbosch University electrical and electronic engineering Professor Thinus Booysen said what the government desperately needed to do was to incentivise the local production of EVs because a catastrophe was waiting.
“More than half of the vehicles produced in SA are actually exported to the UK and Europe and these markets have already said they don’t want ICE vehicles anymore. So when the point comes in the next five years or so, when they say ‘sorry, we don’t want it anymore’, our industry is going to be dead,” Booysen said.
Motor and Industry Staff Association (Misa) strategy and development CEO Hermann Köstens said EV’s were subject to a 45% import and duties tax, import duties on vehicles and automotive components were set at 25% on light vehicles and 20% on original equipment components. This means you pay 20% more import tax on an EV than on a carbon-dioxide motor vehicle.
There have been calls for this levy to be dropped to boost EV uptake but Booysen said that it was crucially important to understand that dropping the level of levy was not a good idea as it would kill the National Association of Automobile Manufacturers of South Africa (Naamsa) and vehicle production in this country.
Booysen said this was because it would then become easier and cheaper to import vehicles, EVs, from other countries like China.
He said the focus should be on locally producing EVs as soon as possible, not for the local market (this would come eventually) but for the international market.
kristin.engel@inl.co.za