South Africa is investing R1 billion to bolster local production of electric vehicles and batteries. The government aims to transition the automotive sector to a mix of vehicle types by 2035, supported by incentives that could attract R30 billion in private investment. Essential minerals for EV production are also part of strategic planning.
The South African government will allocate R1 billion to stimulate local production of new energy vehicles (EVs) and batteries, as confirmed by the national treasury. As the leading automotive manufacturing hub in sub-Saharan Africa, South Africa hosts major brands such as Toyota, Ford, Isuzu, Volkswagen, and Mercedes, among others.
Industry leaders believe that government incentives and policy changes will motivate original equipment manufacturers to enhance investments in the country’s electric vehicle production. In 2023, South Africa unveiled its Electric Vehicles White Paper, which outlines a strategic shift towards producing a mix of electric and internal combustion engine vehicles by 2035.
The national treasury indicated that the department of trade and industry, in collaboration with the department of mineral resources, aims to approve a regional critical minerals strategy in the future, although no specific timeline was provided. Essential minerals such as copper, cobalt, and lithium are crucial for producing electric vehicle batteries and solar panels, playing a significant role in the global energy shift.
The treasury noted that the R1 billion investment is part of a medium-term industrial development support program that seeks to enhance participation and investment in infrastructure across targeted manufacturing sectors, including automotive production. This incentive is designed to boost local manufacturing of new energy vehicles and associated projects, improving efficiency and competitiveness in the sector.
The initiative is projected to draw R30 billion in private sector investments, significantly contributing to the expansion of South Africa’s automotive industry.
In summary, South Africa is poised to augment its automotive manufacturing sector by investing R1 billion in local production of new energy vehicles and batteries. This strategy aligns with the country’s Electric Vehicles White Paper, which aims to transition towards electric vehicle production by 2035. The initiative seeks to enhance infrastructure investment while drawing substantial private sector engagement, thereby reinforcing the nation’s position in the global automotive landscape.
Original Source: techcentral.co.za
