Car builders in South Africa have a new challenge on their hands, as European regulations threaten to cut down on locally-built vehicles exported out of the country.
With its Automotive Package announcement, the European Commission is driving towards a zero-emission vehicle future with regulations that also aim to reduce CO2 emissions on all new vehicles.
Locally-built vehicles are still predominantly internal combustion (ICE) models, and don’t necessarily align with European emissions targets.
Around 4% of motor vehicles imported to the European Union in 2022 were from South Africa, totalling 169,093 units.
If new proposals are implemented, zero-emission vehicles, including battery-electric and fuel-cell electric vehicles, will maintain a key dominance in Europe after 2035.
This is incidentally also the target for South Africa’s Automotive Masterplan.
Together, these regulations spell doom for South Africa’s automotive industry, according to The Electric Mission, which says Europe’s Automotive Package announcement is “no lifeline”.
Battery electric vehicle sales continued to grow in both South Africa and Europe last year, exceeding the number of new internal combustion sales in Europe.
“International regulatory measures put further pressure on South Africa’s industrial transformation into local manufacturing of zero-emission vehicles and their associated components,” said Hiten Parmar, Executive Director of the Electric Mission.
“There are thousands of jobs on the line across the value chain of our automotive industry.”
As part of Europe’s Automotive Package, its Battery Booster component will see investment in European manufacturing capacity to enhance local production of battery electric vehicles.
The Clean Trade and Investment Partnership (CTIP) was also signed between the European Union and South Africa to strengthen the battery value chain across both regions.
“The significance of the 2035 timeline in Europe requires strategic intervention on the part of South Africa’s supply side and demand side policies”, said Parmar.
“This is a critical opportunity to take action and align the South African automotive industry with key markets.”
During the G20 last year, a task force submission to the Presidency sought to bring attention to the adoption of electric vehicles in emerging economies, like ours.
“Fuel efficiency and vehicle emission standards set fleet-wide performance benchmarks, encouraging manufacturers to innovate, whether through more efficient combustion technology or a faster transition to zero emission vehicles,” added Parmar.
The Electric Mission believes that while the automotive sector is a cornerstone of South Africa’s economy, the lack of clear policy and support is endangering it.
European targets welcomed
During Toyota South Africa’s State of the Motor Industry (SOMI) event last week, the company’s CEO, Andrew Kirby, said he welcomed the European Union’s revision of its 2035 target.
The new target lowers the target from 100% reduction in emissions to 90% for new cars and vans, allowing ICE and hybrid vehicles to be imported beyond 2035 if powered by low‑carbon fuels or offset through other decarbonisation levers.
“This pragmatic shift recognises multiple viable pathways to net‑zero. However, we cannot rely on one export destination and assume conditions will stay the same,” he said.
“With incoming UK and EU emissions regulations, our future export volumes are at real risk.”
Kirby reiterated the Electric Mission’s concerns that the lack of policy is endangering the local automotive sector.
“South Africa currently has no new energy vehicle target or regulatory framework, though additional investment support for battery electric vehicles and fuel cell electric vehicles comes into effect in April.”
He stressed that countries accelerating NEV adoption are doing so through clear regulatory signals and targeted incentives.
“South Africa must set clear goals and supportive policies aligned to global trends to accelerate NEV adoption in support of our 2050 net‑zero commitments,” he said.
“The fastest way to reduce near‑term emissions is with HEVs, complemented by PHEVs – which offer practical benefits in our usage conditions – and a growing role for BEVs as charging infrastructure and total cost of ownership improve.”
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