African nations must collaborate with the automotive sector to rethink industrial policies on critical minerals as the global energy transition reshapes industries.With mining and automotive sectors increasingly intertwined, the shift presents both major opportunities and risks. A recent workshop at the Investing in African Mining Indaba explored policy, strategy and value-chain solutions to help African countries navigate this evolving landscape and maximise their position in the new energy economy.“There is good news and bad news,” said Dr Martyn Davies, partner at Arena Partners. “The bad news is that the super cycle driven by Chinese growth that has underpinned the entire development trajectory of this continent is over. The good news is that a new super-cycle is emerging – driven by critical minerals and the energy transition.”Davies said the new super cycle was powering growing new mercantilism – national economic policies to encourage exports. “States are increasingly acting independently,” he said. “At the same time, automotive companies are going upstream, investing in their supply chains, often supported by countries.”Ilya Epikhin, senior principal & global head of natural resources competence centre at Arthur D Little, said one example was that of integrating platinum to produce catalytic converters in South Africa. “Then there can be a focus on downstream manufacturing to go deeper into the other tools and machinery needed. Miners need to increase production volumes needed to supply demand. So, further integration of these partnerships to look into exploration activities could also be beneficial.”During a discussion on future-proofing African mining,Martina Biene, chairperson and MD at Volkswagen Group Africa, highlighted the growing relationship between the mining and automotive sectors, noting its potential to drive innovation and long-term business growth. While still in its early stages, this collaboration is crucial, particularly in South Africa, where the automotive industry contributes 5% to GDP and relies heavily on a range of raw materials. “As the sector evolves with the rise of electric vehicles (EVs), mining’s role becomes even more critical, ensuring a stable and reliable supply of key minerals such as aluminium, steel, copper, lithium, cobalt and nickel, all essential for battery production.”She said a strong and efficient mining sector helped stabilise raw material costs, which directly impacted vehicle manufacturing expenses. “Currently, 80% of global refining capacity is concentrated in the East, but there is an opportunity for Africa to beneficiate its own minerals locally. The successful localisation of the platinum group metals (PGM) value chain – from mining to OEM production – demonstrates the potential for greater industry independence from suppliers," said Biene, emphasising the importance of collaboration. LV
