South Africa targets EV supply chain role to protect auto exports

South Africa is working to secure its position in the global electric vehicle (EV) supply chain to protect its vital automotive industry. The sector is a major economic driver, contributing 23.8% of the country's manufacturing output and supporting over 600,000 jobs. Because approximately 67% of locally manufactured vehicles are exported—primarily to the United Kingdom and the European Union—the industry faces pressure to meet tightening international emissions standards.

To spur production, President Cyril Ramaphosa signed a law providing a 150% tax deduction for investments in electric and hydrogen vehicle manufacturing, effective March 2026. However, industry leaders note that long-term success depends on addressing structural challenges such as electricity reliability, charging infrastructure, and consumer demand.

At the 18th Brics Summit, South Africa has emphasized industrial transformation and EV development as key components of economic growth for emerging economies. President Ramaphosa has used the platform to advocate for intra-Brics trade and to seek investment in critical minerals and the EV battery value chain, specifically targeting partnerships with India.