The number of new energy vehicle (NEV) sold in South Africa increased 245.1% in the first nine months over the same period last year, Naamsa, the automotive business council said Friday.
For the first nine months, 3 092 NEVs were sold, compared to 896 NEVs sold during the full year 2021.
NEV sales by 13 industry brands in the third quarter increased 29.1% to 953 units, from 738 units in the second quarter.
The Department of Trade, Industry and Competition published an Automotive Green Paper on the introduction of NEV’s in May 2021.
The paper highlighted that the NEV challenge in South Africa was two dimensional, encompassing both demand and supply side considerations, and that it was an inevitable transition, as it is the future driving technology adopted by the global auto sector.
Naamsa said the local industry was awaiting clarity from government on the outcome of the recommendations to stimulate demand, and to manufacture NEVs and NEV components.
Alan da Silva, the sales and marketing head at vehicle financier Wesbank, said recently that local vehicle manufacturers would need to respond to global demand dictated by international regulations, particularly those of South Africa’s export markets.
“They will need to gear their manufacturing plants for NEV production and remain competitive, as trading partners will likely no longer require internal combustion engines vehicles. Government support to the SA auto industry is essential to assist the manufacturing sector to adjust to these changes.
”Without this, it is unlikely we could be a competitive global player and the risk is that the manufacturing of these vehicles will take place elsewhere in the world,” said Da Silva.
He said other challenges unique to South Africa needed to be considered, such as the impact on revenue collections through fuel taxes, the impact on fuel forecourt employees, powering NEVs on a constrained grid, how rising electricity costs will impact the charging of NEVs, the evolution of the taxi and public transport systems to NEVs, and the availability of suitable vehicles to power commercial fleets.
Meanwhile, Naamsa data showed Friday that South African vehicle production roared ahead by 49.2% in the third quarter over the same quarter in 2021, when vehicle production was impacted by the cyber attack on Transnet’s operations and economic disruptions at the time;
Naamsa said the increased production was off the back of new vehicle sales increasing strongly by 16,9% in the quarter, compared to the corresponding quarter 2021, and 17,6% compared to the previous quarter.
In line with the recovery in production to pre-pandemic levels, various manufacturers also returned to a three-shift basis, as well as multi-shifts in areas such as machining, press shops, paint shop operations and body shops.
During the quarter, two manufacturers operated on a three-shift basis, two operated on a combined single- double- and three-shift basis; one manufacturer operated on a combined single- and double-shift basis, and two on a single-shift basis.
Third quarter 2022 vehicle exports also increased by 92.2% compared to the corresponding quarter of 2021, when exports were affected by the force majeure declared at the Durban port due to the cyberattack.
Third quarter industry employment reflected an increase of 690 jobs to reach 34 300 positions at end September 2022. The average monthly industry employment number for 2021 was 30 697 compared to 29 926 in 2020.
The third quarter production continued to be affected by the availability and price trends of imported parts, due to logistical challenges at ports delaying raw material imports as well as the global shortage of semiconductors.
Production was also impacted by raw material price increases such as steel, plastic and rubber, and load shedding at a supplier that affected production at an original equipment manufacturer, Naamsa said.