Drive to get SA using electric cars
South Africa's major export car markets will not import internal combustion engine (ICE) vehicles as this will require the local industry to shift to electric vehicle (EV) manufacturing urgently.
BY 2030, South Africa’s major export car markets, including the UK and Europe, will not import internal combustion engine (ICE) vehicles.
This will require the local industry to shift to electric vehicle (EV) manufacturing urgently.
This is according to Simon Woodward, automotive sector head at RMB (Rand Merchant Bank). Woodward was responding to Department of Trade, Industry and Competition’s (DTIC) draft green paper on the advancement of new-energy vehicles in SA, released earlier this year.
He said it was ‘encouraging’ that government recognised the need to modify manufacturing plants to produce hybrid and electric vehicles. However, Woodward noted there is still a price point gap between EV and ICE models of similar size and output.
‘One OEM [original equipment manufacturer] mentioned that its small SUV costs about R500 000 in SA, while the imported cost of the EV derivative would be about R750 000.’
He said manufacturers need the support of the South African government, possibly via ‘higher value export incentives, as well as banks and organised labour’.
‘A good starting point would be tax incentives for the purchase of new, domestically produced EV vehicles,’ continued Woodward. ‘The current import tax regime for EVs is punitive.’
While supporting the export market business is paramount, Woodward said the development of a domestic EV market was critical in promoting more mainstream use.
The need for reliable charging stations Woodward said besides affordability, the lack of charging stations in and between cities and towns needed to be addressed.
‘Car manufacturers may be considering funding companies to build and operate EV charging stations nationally, which could attract third-party funding. However, this doesn’t appear to be imminent – it makes sense for the OEM’s to consider funding into the existing network providers.’
He said the role of fuel companies would also be interesting in terms of making its forecourts available for EV power units.
One positive is that the price of EV batteries has reduced over the past decade, with EV powertrains more efficient than ICE.
Theoretically this should lower maintenance costs.
There is still a need for more efficient inverters to allow for an increased range of EV. Another obstacle is the frequent power outages that could impact charging of vehicles. ‘A potential solution would be coupling incentives by car manufacturers and government to sell new EV cars with photovoltaic (PV) solar solutions – like solar panels,’ he said.
