South African Cars Future Development


The future of the automobile industry in South Africa seems to be taking a new shape in recent years. Although the country has depended on overseas automotive supply over the years, the industry is trying to take a new shape by assembling and producing these parts locally.

Notwithstanding, in recent years, the push for a greener world has been on the rise, and it is only a matter of time before the Internal Combustion Engines (ICE) give way for Electric vehicles.

Within the next 10 to 30 years, countries like France, Norway, and the United Kingdom will have all cars that run on an internal combustion engine off their streets to contribute to improving the earth’s climate condition.

The turn of events overseas may be bad news for automobile companies that have the bulk of their vehicles running on combustion engines, and this development will inadvertently affect businesses that deal in parts supply.


What does this development mean for famous South African cars?

Over the years, automotive brands like Toyota, Ford, Volkswagen, etc., have thrived in South Africa and flooded the market space with their products. Sales of car parts is also a viable business in the country, and this can be linked to the potent and genuine overseas parts supply.

However, with recent happenings globally, the automotive market might be taking a new shape in South Africa. Certain measures by the government are currently being evaluated with impending implementation as the days progress.

For example, the main discussion in the recently concluded automotive sector webinar between FirstRand Group companies, RMB, WesBank, and FNB bolstered the need for cars to be manufactured locally, stating that it will be a potent move in her quest to boost the local automotive sector in South Africa.

The goal is to increase the amount of produced vehicles in the country from 600,000 to 1.4 million per year. The discussion buttressed the point that if this development is achieved, it will boost the relevance and prominence of black-owned automotive suppliers and open up significant partnership doors for deals with reliable overseas car parts suppliers

Furthermore, a transformation fund designed to help the insurgence of BEE (Black Economic Empowerment) participants into the game has been funded by car manufacturers. With South Africa contributing a paltry sum of about 0.8% to the global automobile manufacturing industry, this funding will help the numbers go up significantly.

South Africa’s automotive industry contributes about 6.8% of GDP, employing over 110,000 people, and this sector has an overall impact on almost 2 million people in the country.

The South African government is aware of how important its automotive sector is to the economy and wellbeing of its citizens and, thus, has relentlessly introduced favorable policies to affirm its commitment to this fruitful collaboration.


Fast-tracking localization and future developments

Sadly, this industry still faces challenges in fast-tracking its quest for localization and setting a future-proof supply chain within its borders and integrating with reliable overseas parts suppliers.

Nonetheless, even if the goal of localization is achieved, South Africa’s automobile industry must bear in mind that the currently prevailing internal combustion engines are currently on their way out, and the introduction of electric vehicles is just around the corner.

The introduction of electric vehicles is inevitable, and if South Africa only focuses on localizing the manufacturing of current vehicles on the ground, it might end as a fruitless venture. The automotive industry is evolving globally, and South Africa will have to follow suit not to miss out.

The smart choice or approach will be to start implementing strategies and mapping out plans to have a greener automotive South African industry in the coming years. Failure to follow this path religiously will kick them out of the market completely, starting from step one again.

Therefore, South Africa must weigh herself up adequately and ensure she is ready for an electric future. The cost to put this future in place in terms of infrastructure is much higher than what was needed for internal combustion engines.

The electric future must be perfect and give no place for laxity or incompetence. Therefore, a step up is greatly required, and if the plans are not already in motion, then the future might not be so bright when we get there.


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