South Africa’s automotive sector must urgently revamp its incentive schemes to remain competitive in a rapidly changing global market dominated by new energy vehicles (NEVs) and hybrids, says Deputy Minister of Trade, Industry and Competition, Zuko Godlimpi.
Speaking during a business meeting with automotive stakeholders, innovators and investors at the East London Industrial Development Zone (ELIDZ) in KuGompo City in the Eastern Cape last week, Godlimpi said the sector faced a “price point problem” that required structural reform in production and support measures to improve affordability.
The growing uptake of lower-cost Chinese vehicles has increased pressure on local manufacturers to adapt, he said.
“Both government and the private sector must prioritise technological innovation in the automotive sector, and invest more in research and development to remain competitive. It is also essential for businesses to target the domestic market and exports to other African countries for growth.”
South Africa will need stronger market readiness programmes and export support strategies to grow automotive exports into 22 African markets identified by government. The domestic sector also needs to balance local demand stimulation with stronger regional expansion, Godlimpi said.
Scaling up operations in the Eastern Cape and strengthening industrial capacity in zones such as ELIDZ are important to future competitiveness, while logistics, port infrastructure, energy costs, tariffs, funding constraints and emerging opportunities in solar PV and battery manufacturing are also central, Godlimpi said.
Skills and resilience
In KwaZulu-Natal, the Durban Automotive Cluster identified skills development and value chain resilience as priorities for sustaining the competitiveness of the automotive manufacturing sector at its annual general meeting.
“Through initiatives such as the Automotive Management Development Programme we are actively preparing the next generation of leaders to ensure the long-term resilience and competitiveness of the sector,” said Durban Automotive Cluster Chairperson Andrew Valemen.
“We remain confident that, through continued partnership between industry, government, and stakeholders, KwaZulu-Natal and South Africa can position themselves as globally competitive automotive manufacturing hubs.”
KZN Economic Development Directorate, deputy head, Takalani Rathiyaya, said the AGM had provided an important platform to review the sector’s performance and outline priorities for the new financial year.
© Now Media. This content, including images, is protected by copyright and may not be copied, reused, adapted or republished without permission. If you would like to discuss content-sharing or cooperation opportunities, please contact: editor@freightnews.co.za.
