South Africa’s Electric Vehicle Market Grows Despite Limited Supply and Challenges

In South Africa, there is a growing number of electric vehicles (EVs) available, however, they remain limited. The lack of local supply of EVs in South Africa is particularly in the entry- and midlevel market segments, with most available models competing in the high-end to niche segments. Few battery electric vehicles (BEVs) were available on the local market at the end of 2021, all at the high-end of the market. The availability of hybrid vehicles (HEVs) is slightly higher with 23 HEVs and 11 Plug-in Hybrid Electric Vehicle (PHEVs) having registered at least one sale by the end of 2020. No Fuel Cell Electric Vehicle (FCEV) is currently on offer. This contrasts with the 370 BEV and PHEV models available worldwide in 2020 (IEA 2021).

South Africa’s auto assembly industry relies on exports to the European Union (EU), particularly Germany. As a result, the EU’s 2035 ban on new petrol and diesel vehicles strongly incentivizes South African manufacturers to transition to new energy vehicles (NEVs). In South Africa, NEV sales have been slow, but are gaining momentum. Data from the National Association of Automobile Manufacturers of South Africa (NAAMSA) shows that NEVs accounted for nearly 1.2% of Year-to-date (YTD) sales in June 2023. Notably, NEV sales surged by 47.1% YoY in June 2023.

Battery-run electric vehicle (BEV) sales are low, but they are a fast-growing segment in South Africa’s NEV market, as shown in the graph below.

In the first few months of 2023, South Africa sold 502 BEVs, matching the total number in 2022. Thus, the country has the potential to sell over 1,000 BEVs per year.

The plugless hybrid electric vehicles (HEVs) have also experienced a significant sales surge since 2022. In 2022, 4,050 plugless hybrids were sold, and 2,561 have been sold in 2023. This increase can be attributed to the growing availability of plugless hybrids, such as the Toyota Corolla Cross hybrid.

In South Africa, private passenger vehicles comprise the largest automobile market segment. However, electrifying them poses significant challenges. Nevertheless, 506 BEVs were sold in 2022 for private passenger purposes. The second-largest segment of the auto market consists of light commercial vehicles, used primarily for last-mile delivery services. Several OEMs, including Takealot, Spar, DPD, Skynet, and DHL are entering this market. Another emerging category is electric 2- and 3-wheelers, projected to see a compound annual growth rate (CAGR) of 24.35% and 14.38%, respectively, by 2030. Due to South Africa’s high urbanization rate, this sector is poised for growth, primarily because of fleet owners who want to save money on fuel. The growth is expected to continue at an annual rate of 8.73% (CAGR 2025-2029), resulting in a projected market volume of US$141.6m by 2029.

South Africa has over 350 publicly accessible charging stations, including ones at dealerships. Several companies in 2022 have made substantial investments in expanding South Africa’s public EV charging network. Companies like Audi South Africa partnered with Grid Cars to establish 70 new EV charging stations. These included 4 150kW DC super-charging stations, as well as slower chargers, across 33 locations. For instance, BMW has deployed over 60 ChargeNow stations across the country. Jaguar and Nissan have also invested in expanding the charging network. The public EV charging station sector is expected to experience more significant growth as South Africa’s network continues to expand. This expansion is essential to facilitate long-distance EV travel between cities and provinces.

Electric vehicles produce zero tailpipe emissions, helping to reduce air pollution and combat climate change. Electric motorcars are projected to reduce baseline GHG emissions by 19% in 2050 while internal combustion engine (ICE) motorcars will contribute 63% of South Africa’s emissions.

The Minister of Transport: Honourable Barbara Creecy

Minister correspondence E-mail: TransportMinistry@dot.gov.za

This Post was submitted by Climate Scorecard South Africa Country Manager Rugare Zhou.

Learn More Resources

  1. https://cleantechnica.com/2023/04/04/bev-sales-in-south-africa-look-set-to-double-again-in-2023/
  2. Barnes, J., Montmasson-Clair, G., Moshikaro, L. and Ndlovu, M. 2021. South African New Energy Vehicle Research Report. Pretoria: Trade & Industrial Policy Strategies, B&M Analysts
  3. POLICY BRIEF: 3/2022 Towards an inclusive rollout of electric vehicles in South Africa, Trade & Industrial Policy Strategies (TIPS), by Gaylor Montmasson-Clair TIPS Senior Economist Sustainable Growth, FEBRUARY 2022
  4. 2021. Global EV Outlook 2021: Accelerating Ambitions despite the Pandemic. Paris: International Energy Agency. Available at: https://bit.ly/3CtHdot
  5. Tongwane, M. I., and Moeletsi M. E. 2021. Status of electric vehicles in South Africa and their carbon mitigation potential. Scientific African, Volume 14, November 2021, e00999
  6. https://bolt.earth/blog/south-africa-ev-market?srsltid=AfmBOopbJsbWadl3_r2xDVBVFmYMQfScbc9mA1bXwrZtxuo1WCYe2-J4

 

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