South Africa will invest R1-billion to support local electric vehicle and battery production. The initiative aims to strengthen its automotive manufacturing sector, transitioning towards electric vehicles by 2035. A regional critical minerals strategy is also in development to ensure the supply of essential materials needed for EV production. This support is projected to attract R30-billion in private sector investment.
South Africa is allocating R1-billion to bolster the local production of electric vehicles (EVs) and batteries, as stated by the national treasury. This initiative aims to enhance the manufacturing sector, particularly in reinforcing the nation’s position as the leading automotive hub in sub-Saharan Africa, home to major brands such as Toyota, Ford, Mercedes, and Volkswagen.
The automotive industry advocates for government incentives and policy reforms to motivate original equipment manufacturers (OEMs) to invest in EV production within the country. In 2023, South Africa released its Electric Vehicles White Paper, detailing a strategy that aims to transition the automotive sector from traditional internal combustion engines to include electric vehicles by 2035.
Furthermore, the annual budget review by the treasury highlighted the collaboration between the departments of trade and industry as well as mineral resources to approve a regional critical minerals strategy. This strategy focuses on sourcing essential minerals such as copper, cobalt, and lithium, crucial for manufacturing EV batteries and solar panels, which are pivotal to the global energy transition.
The treasury has earmarked R1-billion for an industrial development support program targeting increased investment in strategic manufacturing sectors like automotive. This program aims to enhance local capability in producing and assembling new-energy vehicles, batteries, and other operational efficiency projects.
The incentive is anticipated to attract R30-billion in private sector investment, thereby significantly boosting local manufacturing capabilities in the realm of electric vehicles and related technologies.
In conclusion, South Africa’s R1-billion investment in local EV and battery production reflects a strategic commitment to modernizing its automotive industry. By fostering an environment conducive to OEM investment and establishing a regional minerals strategy, the country aims to diversify its automotive production by 2035, building a sustainable framework for future energy transitions.
Original Source: techcentral.co.za
