South Africa is positioning itself at the forefront of the global clean transportation revolution by committing roughly $54.27 million to boost its domestic production of electric vehicles (EVs), batteries, and the supporting industrial infrastructure. This investment, announced by the National Treasury, is a cornerstone of the nation’s broader vision detailed in the 2023 Electric Vehicles White Paper.
According to the White Paper, South Africa is planning a major overhaul in both the production and consumption of vehicles, aiming to capture at least 1% of the worldwide EV market by 2035. A key target is to increase the share of locally sourced components in EV manufacturing from 40% to 60%, underscoring a commitment to local industry development.
Officials and industry experts alike see this funding as a critical catalyst for spurring domestic investment, driving technological innovation, and establishing a resilient local supply chain for next-generation vehicles. The move is also expected to boost investor confidence, potentially attracting up to $1.63 billion in private capital to the EV manufacturing sector.
In parallel, the National Treasury outlined plans for a Regional Critical Minerals Strategy. This initiative will focus on the sustainable development and responsible utilization of essential raw materials, such as lithium, cobalt, and manganese, vital for producing EV batteries and solar panels. By emphasizing local processing and manufacturing over mere exportation, the strategy aims to maximize the value of these abundant resources.
The allocated funds will further support a wide range of infrastructure projects within the automotive ecosystem. These projects include establishing new assembly lines, modernizing existing manufacturing facilities, and enhancing supply chain logistics, all designed to strengthen domestic production and secure South Africa’s competitive edge in the global clean energy transition.
As the global automotive industry pivots towards electric mobility, the government faces mounting pressure to update its century-old car manufacturing traditions in line with evolving climate targets and technological shifts. While South Africa remains a key exporter of traditional internal combustion engine vehicles, industry stakeholders agree that the future lies in a sustainable transition to electrification.
Last Updated on March 17, 2025 by samboad
