Taking a step in the right direction, it seems as though Minister Ebrahim Patel’s White Paper is embracing a comprehensive electric vehicle roadmap, with interventions for the local automotive industry.
Looking for your next new or used car? Find it here with CARmag.
At a media briefing on Monday, the 4th of December, Minister Ebrahim Patel released a White Paper outlining a comprehensive EV roadmap tailored specifically for South Africa.
“It is a product of constructive engagement with stakeholders, including within government, industry and labour, to chart a viable and sustainable transition path for the industry,” Patel said.
Related: All Hope is Not Lost as Lamborghini CEO Hopes for Synthetic Fuel Future
This comes at a precarious time after South African infrastructure and governance have local automakers questioning their future in the country. Volkswagen and Ford have both been vocal about their massive investments in Silverton and Kariega respectively with both automakers expressing their intent to remain in the country regarding government policy remains suitable.
Related: Thomas Schäfer Raises Concerns About South African Factory
On the cusp of the electric age and mandates from foreign organisations like the EU prioritising NEVs over ICEs, it has been imperative that South Africa repositions its outdated EV policies to adapt to the evolving automotive landscape considering its automotive export capacity. From the white paper, the most notable news concurrent with the above would be that the Minister plans for South Africa to transition from an ICE vehicle producer to a dual ICE and EV vehicle producer by 2035.
“South Africa’s automobile industry plays a critical role in economic growth and supports thousands of jobs, and the country is also endowed with mineral resources that position it to become a key and strategic player in EV value chains,” the Minister said.
Related: Could Hydrogen Fuel Realistically Become a Thing in SA?
The White Paper in detail
Looking at the document in slightly more detail, Minister Patel has outlined 16 key points to enhance the uptake and development of new energy vehicles (NEVs) in South Africa. These include measures such as facilitating and developing a regional electric battery value chain, increasing investment and funding, implementing a temporary reduction in import duties for batteries in domestically produced vehicles, securing duty-free export market access for South African-produced vehicles and components, energy reforms, commercializing green hydrogen production, and implementing reforms in network industries like freight rail and ports.
The plan also advocates leveraging research and development (R&D) tax incentives to deepen domestic value addition, refurbishing the rail line between Gauteng and Ngqura to enhance overall cost competitiveness, developing an electric vehicle (EV) certification program in collaboration with the industry for skills development, and establishing a framework for fleets to transition to locally produced NEVs. Additionally, the strategy emphasizes scaling up investment in charging infrastructure, supporting increased grid capacity for EV uptake, considering consumer incentives for EV adoption, and evaluating the need for economic regulation on EV charging.
The success of these 16 actions hinges on collaborative efforts from all stakeholders, including government departments, agencies, and the industry. The bottom line of the White Paper is for South Africa to reposition as a country aiming for greater green ratings, uphold and create employment and invigorate the local industry as a serious player in the NEV segment.
While acknowledging the critical nature of the transition, the document also highlights that the shift to low-emission vehicles will take time, with the focus in the 2020s on transitioning electrification toward clean energy and supporting energy security. Unlike Europe, there are no plans to ban combustion engine vehicles in the immediate future and it is unlikely there will be any announcement of the sort in the near future. The phased transition aims to secure established capabilities, such as high export proportions of production, contributions to manufacturing employment, managerial capabilities, worker skill upgrading, and technology multipliers.
With the pending updates, the most exciting news is that the Minister is confident that the first locally-produced EV can roll off of the production line by 2026. According to Patel, further details on the fiscal aspects of the White Paper can be expected in Finance Minister Enoch Godongwana’s Budget Speech in February 2024.
