South Africa needed to regulate swiftly to spur demand for electric vehicles (EVs), the co-CEO of the local unit of Mercedes-Benz said this week as the country’s automotive industry risks being irrelevant to the global market.
For South Africa as a whole, three quarters of its vehicle production is exported.
The luxury carmaker Mercedes-Benz exports 90% of its South African output, primarily to Europe, which plans to ban sales of new petrol and diesel cars from 2035.
At the same time, South Africa’s policy paper on EVs is two years behind schedule. The government has said it would be published this year.
“The train (EV shift) is a global one, and it’s leaving the station. If South Africa doesn’t jump onto the train, it runs the risk of being left behind,” Mark Raine, the co-CEO of Mercedes-Benz Cars South Africa, said in an interview.
“A concrete EV Policy is definitely required and would support the inevitable evolution of the automotive industry to electric vehicles,” he said further, adding that the policy needed to be implemented “soonest”.
Specifically, South Africa would need to boost demand by cutting the import tax for EVs, setting up large-scale EV charging stations and investing in skills needed for the new ecosystem that EVs brought, he said.
The German carmaker had a plan to phase out diesel and petrol cars from its factories globally, starting in 2030, but in the absence of a robust local ecosystem, the transition in South Africa was proving to be challenging, Raine said.