As Europe tightens emissions guidelines and imports acquire market share, carmakers say South Africa should urgently align industrial coverage with the worldwide shift to new-energy automobiles
Because the begin of 2026, many automotive legacy manufacturers have been speaking concerning the disruptions going through the South African motoring business.
The 2 key disturbances producers have famous are the variety of gross sales of imported automobiles previously 12 months and the nation’s readiness to undertake new-energy automobiles (NEVs).
Presenting Toyota South Africa’s manufacturing figures just lately, chief-executive Andrew Kirby confused the significance of getting steadiness between imported automobiles and knocked-down automobiles on the nation’s roads, whereas warning in opposition to an over-reliance on imports.
“They create a vibrant market that brings in plenty of totally different types of automobiles that our clients want. We will’t count on to provide every part in South Africa. That will be an unrealistic expectation however do we now have steadiness?” Kirby stated at a Toyota state of the motoring business occasion.
In 2025, of the 609 000 automobiles produced in South Africa, most of them — 411 000 — had been exported. That implies that solely 32% of automobiles manufactured within the nation are offered right here. That determine has dropped by greater than 20% over the previous 20 years.
Car imports from China made up 22% of all automobile imports into the nation in 2024, up 368% from 2020.
Final month, the division of commerce, business and competitors warned about attainable greater tariffs for imported automobiles, suggesting that South Africa elevate the 25% charge to 50%.
Kirby stated that whereas that may enhance native automobile makers, the problem must be handled fastidiously, bettering the competitiveness of producing in a “fiscally impartial means”.
“We’re not suggesting an enormous blunt instrument to all of the sudden appropriate this. What we’re suggesting is tweaking and small modifications on a wide range of totally different components that may enhance our competitiveness,” he stated.
In January, BMW chief govt Peter van Binsbergen was equally cautious, saying a 50% tariff could be a shock to the system and will introduce unintended penalties. He advised fine-tuning measurements within the Automotive Manufacturing and Growth Programme (APDP) to encourage actual manufacturing in South Africa.
“Basically, we have to make it viable for extra manufacturers to return to South Africa after which they grow to be a part of the answer,” Van Binsbergen stated.
Coverage modifications round NEVs in Europe and the UK might have an effect on South African exports negatively, Toyota’s Kirby stated.
In 2025, South Africa exported 81% of domestically manufactured automobiles to Europe and the UK, whereas solely 8% had been offered round Africa. This in contrast with 19% of domestically manufactured automobiles exported to Africa in 2006 and solely 21% to Europe. It illustrates that automobile exports are closely reliant on the UK and European markets.
The European Union, nevertheless, has a goal of a 90% discount in emissions by 2035, whereas the UK will ban the sale of recent inside combustion engine passenger automobiles by 2030.
This has raised alarm amongst native producers relating to South Africa’s readiness to export NEVs to their largest market.
Toyota and Lexus led SA’s NEV market, with a mixed share of 58% in NEV gross sales. Nevertheless, solely 2.8% of the automobiles they offered final 12 months had been NEVs.
South Africa would see a major decline in exports to the UK and Europe over the subsequent 5 years, Kirby stated.
“We don’t have aggressive new-energy automobiles. Now we have some however we don’t promote many domestically and we haven’t localised these parts. For us to be aggressive with any automobile, we have to have a scale to localise these parts in order that we may be aggressive,” he stated.
“We’d like to consider how we’re going to regulate our strategy. Most large markets world wide have put particular interventions into place. Supporting clients, supporting the enterprise and creating penalties and incentives to speed up the transition to NEVs.”
Volkswagen Group Africa managing director Martina Biene has additionally expressed her concern on this regard.
Eventually week’s VW Indaba on the producers plant in Kariega, she stated that finalising NEV incentives below the APDP and clarifying laws had been important to unlocking funding in NEV and battery electrical automobile manufacturing, constructing supporting infrastructure and making the automobiles inexpensive, notably for export competitiveness.
Biene wrote to President Cyril Ramaphosa in December concerning the surging imports and the rising value of doing enterprise in South Africa, noting that just one in three vehicles offered in South Africa was domestically manufactured.
Stories then circulated that VW’s plant confronted closure. Nevertheless, the producer has since stated that it remained dedicated to South Africa because it celebrated 75 years of constructing and promoting automobiles within the nation in 2026.
Toyota stated that turning the business round required bettering fully knocked-down competitiveness by means of APDP modifications, aligning the event plan and NEV coverage for a multi-pathway transition, accelerating the Africa Continental Free Commerce Settlement to cut back reliance on exports to Europe and the UK and fixing the nation’s structural constraints, amongst them electrical energy, water and logistics.
