H. Yoo
Research expert covering South Korea
Automotive industry in South Africa - statistics & facts
The South African automotive industry is a major player in the nation’s manufacturing sector due to its global exports and production capacity, which significantly contributes to its industrial development. The sector makes a substantial contribution to the country’s GDP and the overall manufacturing output. In 2023, South Africa's vehicle export industry experienced significant growth, though it fell short of the levels seen in 2019, with Europe emerging as the primary destination for its automotive exports. South Africa has advantageous access to the European market through free trade agreements. This preferential market access has subsequently boosted South Africa’s positioning in the global vehicle production landscape.
Production and global market share
The robust export figures align with South Africa's increasing domestic vehicle production. In 2023, the country marked the highest output of manufactured vehicles in recent years. This production surge contributed to South Africa's growing presence in the global automotive market, with its share in worldwide vehicle production consistently rising year-on-year and maintaining its rank in 22nd place. The increase in both production and exports indicates a strong recovery from pandemic-related disruptions and underscores the sector's importance to the South African economy. Overall, South Africa remained the dominant market on the African continent despite a slight decline in its vehicle production share. However, Morocco is emerging as a strong competitor and South Africa is now implementing measures such as tax rebates and subsidies to encourage the adoption of electric vehicles (EVs) to maintain its competitive edge.
Environmental considerations
South Africa’s electric vehicle (EV) market is experiencing growth, but it remains modest compared to global trends. In 2023, under 1,000 electric vehicles were sold in the country. As the automotive industry expands, environmental concerns remain at the forefront, and the transport sector contributes a considerable amount to the country’s greenhouse gas emissions. Traditional hybrid vehicles, for instance, produce substantially lower carbon dioxide emissions per passenger kilometer compared to their conventional counterparts, particularly diesel SUVs. This slight shift towards greener technologies goes along with global trends and may influence future export patterns as international markets increasingly demand environmentally friendly vehicles.
While the government is implementing initiatives to promote the use of electric vehicles, the current economic environment and infrastructure limitations suggest that significant growth in EV adoption may take some time. Continued investment in infrastructure, supportive policies, and a stable electricity supply will be crucial to accelerate the transition to electric mobility in South Africa.
Production and global market share
The robust export figures align with South Africa's increasing domestic vehicle production. In 2023, the country marked the highest output of manufactured vehicles in recent years. This production surge contributed to South Africa's growing presence in the global automotive market, with its share in worldwide vehicle production consistently rising year-on-year and maintaining its rank in 22nd place. The increase in both production and exports indicates a strong recovery from pandemic-related disruptions and underscores the sector's importance to the South African economy. Overall, South Africa remained the dominant market on the African continent despite a slight decline in its vehicle production share. However, Morocco is emerging as a strong competitor and South Africa is now implementing measures such as tax rebates and subsidies to encourage the adoption of electric vehicles (EVs) to maintain its competitive edge.
Environmental considerations
South Africa’s electric vehicle (EV) market is experiencing growth, but it remains modest compared to global trends. In 2023, under 1,000 electric vehicles were sold in the country. As the automotive industry expands, environmental concerns remain at the forefront, and the transport sector contributes a considerable amount to the country’s greenhouse gas emissions. Traditional hybrid vehicles, for instance, produce substantially lower carbon dioxide emissions per passenger kilometer compared to their conventional counterparts, particularly diesel SUVs. This slight shift towards greener technologies goes along with global trends and may influence future export patterns as international markets increasingly demand environmentally friendly vehicles.
While the government is implementing initiatives to promote the use of electric vehicles, the current economic environment and infrastructure limitations suggest that significant growth in EV adoption may take some time. Continued investment in infrastructure, supportive policies, and a stable electricity supply will be crucial to accelerate the transition to electric mobility in South Africa.
