South Africa’s Auto Trade Soars as Record Exports Bolster Economy

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South Africa’s automotive industry has witnessed a remarkable surge in trade, driven by record vehicle exports that have bolstered the nation’s economy. According to the annual Automotive Trade Manual, vehicle exports played a pivotal role in elevating the industry’s trade balance to a positive R21.1 billion in 2023, marking a significant increase from R19.6 billion in the previous year.

Norman Lamprecht, the chief trade and research officer at the automotive business council Naamsa, underscored the enduring significance of vehicle exports as the cornerstone of the industry’s robust trade balance since 2008. Despite economic challenges dampening domestic vehicle sales, the automotive sector thrived, outperforming other manufacturing segments, largely due to its formidable export performance.

In 2023, vehicle exports reached unprecedented levels, contributing to a substantial portion of the industry’s revenue. Export revenue surged by 19.1% to a record R270.8 billion, with vehicle exports alone witnessing a staggering increase of 29.9%, totaling R203.9 billion. However, automotive component exports experienced a slight decline of 4.8%, attributed in part to decreased catalytic converter exports.

While export figures soared, imports also surged, primarily fueled by a notable increase in the imports of original equipment components. This uptick in imports reflects the industry’s efforts to accommodate new model launches in the domestic market.

Looking ahead, Lamprecht highlighted the objectives outlined in the South African Automotive Masterplan (SAAM) 2021-2035, aimed at elevating vehicle production and localization levels. The plan seeks to increase vehicle production to 1.4 million units annually by 2035 and enhance localization levels from 40% to 60%, thereby reducing reliance on imported components.

Furthermore, South Africa’s automotive industry is poised to embrace the transition to electric vehicles (EVs), as emphasized by Minister of Trade, Industry and Competition Ebrahim Patel. The Electric Vehicle White Paper, released in November 2023, delineates a comprehensive roadmap for integrating EVs into the automotive landscape by 2035, aligning with global trends towards sustainable mobility.

The industry’s momentum is further buoyed by significant investments, including Stellantis’ commitment to establish a new automotive plant in the Eastern Cape and BAIC’s production initiatives in Coega. These developments underscore South Africa’s position as a key player in the global automotive arena, poised to capitalize on emerging opportunities and navigate the evolving landscape of mobility.

As the nation charts a course towards increased vehicle and automotive component production, the automotive sector stands as a beacon of economic resilience, poised to leverage its strengths and adapt to emerging trends in the global automotive landscape.

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