South Africa Plans to Increase Local Vehicle Production

(MENAFN) South Africa is preparing to announce comprehensive policy reforms by February's end designed to accelerate domestic vehicle manufacturing, government officials informed parliament on Monday.

Deputy Trade, Industry and Competition Minister Zuko Godlimpi revealed authorities are examining modifications to luxury (ad valorem) taxation while exploring elevated tariffs on foreign-manufactured vehicles to stimulate local production capacity.

Mzwandile Masina, Chairperson of the Portfolio Committee on Trade, Industry and Competition, underscored the automotive sector's pivotal economic significance for the nation.

He stated the industry "plays a critical role" and "presents real opportunities for transformation and the growth of township economies," stressing that government procurement strategies must be deployed "to support domestic vehicle production, improve economies of scale, and expand the range of components produced locally."

Parliamentary committees intend to spearhead efforts targeting a doubling of automotive employment by 2035 while enhancing industrial competitiveness.

"The key objectives are to ensure South Africa ultimately contributes 1% to global vehicle production, with up to 60% local and 100% employment growth," the Department of Trade, Industry and Competition reported.

South Africa's automotive marketplace features both multinational and indigenous manufacturing: Toyota, Volkswagen, Ford, Isuzu, Suzuki, and Hyundai rank among extensively marketed brands, with several maintaining local assembly operations. Toyota retained its market leadership position in 2025, with flagship models including the Hilux and Corolla Cross assembled domestically. Chinese manufacturers such as Chery and GWM (including Haval models) are rapidly expanding their market penetration.

The nation hosts multiple specialized domestic automakers: Birkin Cars manufactures lightweight Lotus Seven-style kit vehicles, Bailey Cars produces competition-focused sports automobiles, and 2025 witnessed EVerione debut electric vehicles with ambitions for indigenous battery manufacturing.

National vehicle production climbed from approximately 499,000 units in 2021 to 667,000 in 2024, though imported automobiles continued dominating market composition, with light vehicles representing 69% of 2025 sales.

The automotive industry sustains over 115,000 direct manufacturing positions and exceeds 500,000 jobs throughout the supply chain, generating roughly 5.3% of national GDP, according to media.

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