Good news for South Africa – UK delays petrol car ban

The United Kingdom (UK) has pushed back its proposed ban on petrol and diesel car sales by five years, with the new date set at 2035.

This is great news for the South African automotive manufacturing industry, which is largely dependent on exports of internal-combustion-engine (ICE) cars and contributes around 4.9% to the country’s annual GDP, as the UK is the main destination for locally-produced cars, according to the Automotive Industry Export Council (AIEC).

Therefore, if the UK imposes a complete ban on fossil fuels before the domestic manufacturing industry manages to switch over to new-energy vehicle (NEV) development, South Africa risks losing up to 20% of its aggregate vehicle exports, or roughly R31 billion.

The extra time will give local automakers a longer window to invest in their facilities and start producing NEVs and their related components to soften the blow of an all-out petrol ban in its most important market.

Soon, the country will start producing the plug-in hybrid X3 for export, and talks of Chinese electric-car maker BYD establishing a factory on local soil are also ongoing, but the switch from ICE to NEV development in South Africa has been slow, to say the least.

Why the sudden change of heart

The new proposed deadline is, in fact, the second time that the UK has decided on the 2035 cut-off date.

In 2020, it moved the initial date from 2035 to 2030 due to fears of accelerated global warming, a choice that was largely driven by emotion and not enough clarity, said Prime Minister (PM) Rishi Sunak.

Now back at 2035, Sunak said he still believes that climate change is “real and happening” and that most vehicles sold in the UK by 2030 will be hybrid or electric, but that this is a choice that should be made by the consumer, not the government, Bloomberg reports.

The 2030 date also led to UK citizens being forced to shoulder “unacceptable costs” by having to switch over from their affordable ICE cars to pricey NEVs and installing eco-friendly heating and insulation solutions in their homes, for fears of paying hefty fines if they didn’t, but this is something many of them could not afford due to the country’s skyrocketing cost of living over the past few years.

The PM said Britain remains committed to its overall net-zero target by 2050, but that it can afford to make slower progress in getting there because it is “so far ahead of every other country in the world.”

The decision to once again move the ban to 2035 has been met with backlash from automakers including Ford, Kia, and Volkswagen, as many of them have already made huge investments in NEVs in line with the 2030 target, with this extension poised to undermine their sales potential.

Manufacturers expect consumers to reevaluate their need to buy battery-powered autos, which in turn will disrupt plans to add much-needed NEV infrastructure to the country and risk slowing down the momentum that the UK has built up thus far, writes Reuters.

Toyota, on the other hand, said it welcomed the move as it helps the industry and consumers adapt and that it “recognises that all low emission and affordable technologies can have a role to play in a pragmatic vehicle transition.”