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Jenny Tennant

The green shoots of an economic recovery

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In his weekly newsletter published on 17 November 2025, President Cyril Ramaphosa wrote that in the week of the G20 Leaders’ Summit – the first to be held on African soil – South Africa is able to showcase a country and an economy on the rise. In the week that we prepare to host the first summit of the G20 on African soil, we are able to showcase a country and an economy on the rise. A number of key economic indicators and developments in the past week point to the green shoots of an emerging economic recovery. Unemployment is down. Data from Statistics South Africa show that the official unemployment rate fell to 31.9% between July and September this year, down from 33.2% recorded in the previous quarter. Nearly 250 000 more people were in employment in the third quarter. Of these, around 130 000 were added in the construction sector. The Medium-term Budget Policy Statement delivered last week points to a sustained turnaround in government finances. We are on track to achieve a third consecutive primary budget surplus. This means that, excluding interest payments on our debt, we are collecting more in revenue than we are spending. This is a sign of prudent financial management, giving us space to steadily reduce our debt to sustainable levels. Also last week, our sovereign credit rating was upgraded by S&P. This is the first such upgrade from the agency in nearly two decades. An improved rating generally leads to lower borrowing costs, which allows for more funds to be invested in the economy and in meeting social needs. Among the factors S&P cited for the positive outlook were Eskom’s improved performance, strong tax collection and the broad structural reform momentum having ‘picked up pace’. When we established Operation Vulindlela in 2020 as a government coordinating mechanism to implement transformative reforms and boost economic growth, the initial focus was on the network sectors as well as immigration reform. We are seeing steady progress in the logistics sector, notably with respect to improved performance at our ports. Measures to allow private sector companies to operate on the national freight rail network are also at an advanced stage. The most noteworthy improvements have been witnessed in the energy sector, with Eskom now on the road to recovery, massive investment in renewable energy generation, and vastly improved electricity supply. In support of South Africa’s ratings upgrade, S&P cited the recently launched Phase II of Operation Vulindlela, which is focusing on changes in local government, digital transformation, visa regimes, spatial inequality and others. Modelling from the University of Stellenbosch’s Bureau of Economic Research (BER) has estimated that the potential impact of the Operation Vulindlela reforms could lift South Africa’s long-term growth rate by as much as 3.5% when fully implemented. In citing this modelling, the analyst JP Landman writes that “the reforms are a journey, but they have started working. Step by step, South Africa is opening its economy, modernising infrastructure and rebuilding credibility”. Despite considerable headwinds that have including a global pandemic, a debilitating energy crisis and more recently, a difficult global trade environment, we have stayed the course on economic recovery and are now seeing this pay off. Following a ruinous period of economic stagnation and capture of the state, we have been able to achieve sustained progress in a relatively short period of time. This is in no small part owing to the strength of the partnerships forged between government, business, labour and civil society. These far-reaching economic changes have a direct and material impact on the lives of every South African, on their ability to lead dignified lives, to access public services, to secure employment, and to provide for their families. We are determined to sustain the momentum of this economic recovery, so that we can drive inclusive growth, create jobs and improve the lives of our citizens.

BBBEE can help drive industrial transformation in SA’s automotive sector

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Broad-based black economic empowerment was never meant to be about compliance. It was meant to be about change, about opening doors, building skills, and creating real economic inclusion, writes Dr Bheka Zulu, CEO of the Tshwane Automotive Special Economic Zone. When we talk about transformation in South Africa’s economy, it often sounds like we are talking about paperwork. Too often, broad-based black economic empowerment (BBBEE) gets treated as a box-ticking exercise, a scorecard to be managed, instead of a movement to be led. But BBBEE was never meant to be about compliance. It was meant to be about change, about opening doors, building skills, and creating real economic inclusion. At the Tshwane Automotive Special Economic Zone (TASEZ), we sit at the crossroads of two of South Africa’s biggest goals: industrialisation and empowerment. This week, as we hosted a BBBEE Commission workshop with our tenants, partners, and local community representatives, one issue came into clear focus – transformation in the automotive sector must go beyond talk. It needs to deliver real, measurable results. A sector that matters The automotive industry plays a huge role in South Africa’s economy. It contributes around 5.3% to national GDP and about 30% of total manufacturing output. Behind those numbers are people – more than 130 000 direct jobs, and many thousands more through the supply chain. But the truth is, transformation has not kept pace with this growth. Leadership in the sector still does not reflect the demographics of our country. Ownership remains concentrated. Supplier development often stops at token efforts. As the industry shifts toward new energy vehicles (NEVs), we have an opportunity to correct this. The future of the automotive sector cannot mirror the inequalities of the past. BBBEE gives us the framework to do things differently. The codes of good practice were never just about ownership; they were about five interconnected pillars: ownership; management control; skills development; enterprise and supplier development; and socio-economic impact. These must now become the foundation for how we build a fairer, more innovative, and future-ready industry. Turning policy into progress At TASEZ, we have made a deliberate choice to make transformation practical and measurable. In recent years, we have channelled more than R1.7-billion in contracts to small, medium and micro enterprises (SMMEs), many of them black- and women-owned. Over 40% of our procurement is local. Those are not just numbers on a page, they translate to more than 5 000 jobs created during construction, 80% of them for women and 60% for young people. People with disabilities are also increasingly part of our projects. But transformation is not just about procurement spend. It is about building capacity that lasts. I would suggest we establish a Skills Development Forum that brings together original equipment manufacturers (OEMs), component suppliers, and local colleges to make sure the skills we teach match the jobs that exist and the jobs that will exist in the future. Small businesses are another priority. Many promising enterprises do not fail because of a lack of ideas, they fail because they do not have the support systems for compliance, HR, or financial management. That is why TASEZ is introducing shared back-office support for SMMEs in the automotive value chain. If we want black industrialists to thrive, we cannot expect them to do it alone from garages and backrooms. Building local capacity Real transformation is also about building economic independence. For too long, our sector has depended on imports. We have to change that by focusing on localisation and innovation. Our goal, as expressed in the South African Automotive Masterplan 2035, is to raise local content levels from 40% to at least 60%. That means developing black-owned suppliers into full manufacturers, innovators, and exporters, not just intermediaries. It means investing in partnerships with universities and research institutions, so that South African engineers and entrepreneurs can lead the way in electric mobility, battery recycling, and green manufacturing. We should also put in place a Green SMME Innovation Sandbox to support enterprises involved in circular economy opportunities like waste recovery, e-waste, and battery recycling. Let us create a space where new ideas can be tested. The future of BBBEE is as much about sustainability as it is about ownership. Inclusion must be intentional True transformation leaves no one behind. We have seen the incredible results when women and people with disabilities are intentionally included in training, production, and leadership. That inclusion needs to become standard practice. The same applies to our local communities. Our social compact with residents around TASEZ is not symbolic, it is real. Through enterprise incubation, community training, and mentorship programmes, we are working to make sure that the special economic zone (SEZ) model uplifts the people who live closest to it. Transformation and competitiveness go hand in hand The automotive sector is at a major turning point. By 2035, the world will be dominated by NEVs. Export markets are already tightening their emissions standards, and if we don’t adapt quickly, we risk being left behind. Transformation must therefore be seen as a tool for competitiveness. BBBEE should drive innovation and productivity, not just compliance. It should open doors for local firms to access global supply chains and strengthen their ability to compete. That means better financing for black suppliers, guaranteed offtake agreements, and strong mentorship partnerships between international OEMs and emerging South African manufacturers. The road ahead Our message is simple: let us reclaim BBBEE as a national mission for industrial renewal. Let us link empowerment to productivity, localisation to sustainability, and inclusion to innovation. The next phase of transformation must be about building black-owned exporters, green manufacturers, and a generation of young technicians ready for the digital and green mobility era. We need to move from counting scorecards to building real capacity, because transformation is not only about fairness, it is about South Africa’s readiness for the future.

TASEZ shows how SA can build an economy that works for all

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By Mandla Mpangase Every South African knows that when infrastructure fails, life becomes harder. Jobs disappear. Businesses relocate. Communities lose hope. But when infrastructure works, everything else begins to work too. Factories stay open. Investors arrive. That is the import of the speech given on 13 November 2025 by President Cyril Ramaphosa at the National Construction Summit held in Kempton Park, Ekurhuleni. “We are a gathered here not just to talk about building an industry, but to build a nation,” the president said, adding: “We are gathered here to share a dream and determination to build a country that works for all its people. South Africa’s national economic drive has never been only about building structures; it has always been about building a country that gives every person a fair chance – something clearly articulated in the National Development Plan (Vision 2030). And the message has been clearly stated through the years of democracy. “From a social development perspective, infrastructure provides people with what they need to thrive,” President Ramaphosa told the summit participants. “It improves the quality of life and can play a key role in reducing inequality. Through reliable infrastructure we can boost productivity and reduce costs of living.” It also provides countries with what they need to grow and develop. “Infrastructure facilitates trade and commerce. When we boost infrastructure through the construction industry we attract investment.” And few places capture this mission more clearly than the Tshwane Automotive Special Economic Zone (TASEZ). Where infrastructure becomes industrial strength “Infrastructure is the backbone of development because, among many other reasons, it bolsters economic competitiveness and sustainability. Without infrastructure economic growth slows down, inequality deepens and the quality-of-life declines,” Ramaphosa said. For years, underinvestment in roads, rail and logistics has held back the key sectors of mining, agriculture, and manufacturing. But South Africa is now shifting course. As the president pointed out: “Infrastructure is poised to once again become the flywheel of the economy. Infrastructure investment is one of the most effective levers for stimulating economic activity.” This is evident in the employment figures released by Statistics SA earlier this week. The latest Quarterly Labour Force Survey released by Statistics South Africa in November 2025 indicates a decrease in the official unemployment rate from 33.2% in the second quarter of this year to 31.9% in the third quarter. Employment increased by 248 000 in the third quarter, with construction the largest contributor with 130 000 new jobs. This is not an accident. It is the result of a deliberate national effort to turn infrastructure into a growth engine. And TASEZ is one of the clearest examples of what that looks like in practice. The special economic zone (SEZ) is proof that when investment is made in the right infrastructure such as reliable power, efficient logistics, modern digital systems, further investment is made, jobs are created, and industrial capability is strengthened. TASEZ is where South Africa’s automotive future is being built, factory by factory, with global manufacturers choosing the Tshwane SEZ because the fundamentals are already in place. A model for inclusive growth The zone is succeeding not only because of its industrial strength but because of its social impact. It is bringing economic activity to communities long left on the periphery. It is creating opportunities for young people entering technical fields. It is giving small businesses a stake in a globally competitive value chain. As TASEZ CEO, Dr Bheka Zulu, notes: “When we talk about spatial redress, this is what it looks like: development that doesn’t speak about communities but works with them.” Towards investment Government has committed R1-trillion in infrastructure spending over the medium term, alongside reforms to unlock greater private investment. Procurement war rooms, new public-private partnership guidelines and accountability frameworks are designed to ensure that projects do not stall but move quickly from planning to ground-breaking. As the world prepares to join South Africa for the G20 Leaders’ Summit, the country is showing what renewal looks like on the ground. Roads being rebuilt. Industrial zones like TASEZ expanding. If this momentum is sustained, TASEZ will not be the exception but the blueprint, demonstrating what is possible when strong infrastructure, a capable state and committed investors come together.  

TASEZ, tenants and local communities to build shared value through BBBEE collaboration

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By Mandla Mpangase The Tshwane Automotive Special Economic Zone (TASEZ) is strengthening its partnerships with tenants, local communities and medium, small, and micro enterprises (MSMEs) to ensure that broad-based black economic empowerment (BBBEE) becomes a shared journey of inclusion, opportunity and practical transformation. This was the central idea emerging from a workshop held by the BBBEE Commission at TASEZ on 4 November 2025, where large business representatives, community leaders, and MSMEs came together to explore how collaboration can unlock sustainable growth for all. Sibusiso Khuzwayo, acting executive for zone operations and senior manager for enterprise development at TASEZ, concluded the workshop by highlighting several key priorities. He emphasised the immediate need to engage specialists from the Department of Trade, Industry, and Competition (the dtic), particularly in the areas of automotive BBBEE and logistics, to help address the challenges faced by tenants. Khuzwayo also underscored the importance of collaboration between tenants and TASEZ to effectively integrate MSMEs from the surrounding communities into the broader enterprise and supplier development (ESD) ecosystem. This collaborative approach offers quick wins by aligning tenant needs with targeted interventions that enable local businesses to participate in the supply chain and deliver high-quality, fit-for-purpose services. Strategic tool He further stressed that BBBEE should not be viewed merely as a compliance requirement, but rather as a strategic tool for fostering meaningful connections – linking large enterprises with township-based suppliers, emerging manufacturers, and service providers to build sustainable, long-term economic capacity. “We are trying to create an enabling environment that creates opportunities for robust partnerships,” said Khuzwayo. “Our role at TASEZ is to bring together three interests: businesses that want to make profit, communities that need opportunities, and local suppliers who are eager to grow. “The real challenge is making sure all three talks to each other, and that’s where TASEZ steps in.” The BBBEE Commission outlined the key elements of the codes and explained various technical details companies and emerging entrepreneurs needed to know in order to meet the BBBEE requirements. Time was spent on tackling real-life issues, providing answers to questions from the businesses and emerging entrepreneurs in the room. In his closing, Khuzwayo went through the issues raised during the morning. There were a number of concrete measurable steps suggested, including providing the tenants with a database of the MSMEs from the local communities; ongoing training; hosting regular meetings focusing on ways to support local businesses in transforming and growing their businesses; and creating network opportunities. Khuzwayo emphasised that enterprise and supplier development – a core element of BBBEE – sits at the heart of TASEZ’s economic inclusion strategy and proposed establishing targeted development funds and mentorship initiatives that would directly support MSMEs in key sectors such as automotive components, logistics, and waste management. “We must sit down together, identify 10 high-potential MSMEs, and support them with training, mentorship and market access. When we meet again in six months, we should be able to see tangible progress.” Identifying challenges Khuzwayo noted that one of the recurring challenges is the lack of visibility between the tenants in the special economic zone (SEZ) and local suppliers. “If tenants are not aware of who’s on our local supplier database, we’re doing something wrong,” he said. “We want to ensure transparency so that when procurement opportunities arise, our tenants can source locally before looking elsewhere.” The workshop also explored opportunities in waste management, which Khuzwayo described as “a sector rich with potential for community enterprises”. With the automotive industry generating substantial waste by-products, TASEZ is exploring how to support cooperatives and small businesses that can turn this waste into income-generating opportunities, from recycling and materials recovery to green manufacturing. He also noted that the workshop had called for specialised technical partnerships with entities in the dtic and other automotive sector bodies to enhance BBBEE scorecards in ways that are practical and impactful. “We want future engagements to be more focused, whether it’s on training, supply chain inclusion, or skills development,” Khuzwayo said. “If we’re told that South Africa will need 10 people skilled in robotics in the next five years, we want to ensure we’ve already started developing them locally. We can’t say ‘we can’t find them’, we must create them together.” The BBBEE workshop marked the start of a new cycle of collaboration between TASEZ, its tenants, and the communities surrounding the Silverton automotive hub. Rather than treating empowerment as a tick-box exercise, Khuzwayo said, the goal is to make it a shared ecosystem of value creation. “This cannot be a TASEZ issue alone,” he concluded. “Transformation and growth are only possible through collaboration. We need business, education, youth, and communities to come together so that the benefits of industrial development are truly shared by all.” The day’s discussions underscored that BBBEE needed to be more than just a policy. It needed to be a partnership model in action, designed to ensure that as the TASEZ grows, so too do the people and enterprises around it.

TASEZ secures fifth consecutive clean audit, affirming strong governance

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The Tshwane Automotive Special Economic Zone (TASEZ) has once again demonstrated excellence in public-sector governance, securing its fifth consecutive clean audit from the Auditor-General. Africa’s first automotive city, TASEZ continues to strengthen its position as South Africa’s premier special economic zone for automotive investment. The achievement comes as the organisation advances its Phase 2 development, expanding its industrial footprint and diversifying opportunities for investors in the automotive manufacturing value chain. CEO Dr Bheka Zulu says the clean audit underscores TASEZ’s commitment to transparency, consistency and responsible financial management. “Not only is TASEZ an innovative driver of economic development through supporting the manufacturing sector, it is also a shining example of good governance,” he notes. For investors, the clean audit provides critical assurance. “It assures our investors, both international and local, that their investments are managed with integrity and diligence. The confidence of our partners is built on our ability to demonstrate sensible, judicious and transparent fiscal management,” Dr Zulu says. As one of the key implementers of South Africa’s industrial development policies, TASEZ plays a central role in attracting investment, creating jobs and supporting small, medium and micro enterprises. Its mandate includes driving inclusive growth for communities in Mamelodi, Eersterust and Nellmapius, located near the economic zone. Dr Zulu adds that consistent clean audits an organisational culture anchored in accountability. “Good governance is not a checkbox activity for us. It is the foundation on which we build sustainable industrialisation and long-term investor confidence.” With Phase 2 now firmly underway, TASEZ’s latest audit outcome strengthens its trajectory as a reliable partner in South Africa’s automotive manufacturing ecosystem, reinforcing its position as a catalyst for economic reform and industrial expansion.

Gauteng maps out its NEV future as Summit draws to a close

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By Mandla Mpangase The Big Question at this week’s New Energy Vehicles Summit can best be summed up as ‘How can South Africa fast-track to alternative energy vehicles?’ On Day 2 of the NEV Summit 2025, hosted by the Gauteng Growth and Development Agency, the Automotive Industry Development Centre (AIDC) and the Tshwane Automotive Special Economic Zone at Gallagher Convention Centre, in Midrand, on 23 October 2025, a panel discussion on Challenges and opportunities in the charging infrastructure provided some answers. Moderated by the Department of Transport’s Pulane Manale, some pointed questions were posed to the panellists around “smart charging”, the use of artificial intelligence (AI), skills development, the business case for NEVs, the country’s readiness for the transition, and the role of government interventions. In response, the panel made it clear that South Africa’s road to green mobility will be powered not only by technology, but by collaboration, innovation and decisive government action. Technology at the heart of the transition Cathy Shilubana, CEO of Volt Hi reiterated that green mobility was tech-based. “AI helps us manage everything, from the interface between drivers and chargers to predicting carbon emissions and detecting vandalism or faults in real time. Our systems can lock down automatically if tampering is detected. That’s how AI is securing the infrastructure.” The company, which is partnering with the AIDC, revealed plans to establish an EV-charger assembly plant in South Africa, training local engineering graduates and sending them to China for hands-on experience. “We are reskilling young people for jobs that are fit for purpose,” she added. “This is how technology transfer becomes job creation.” Lessons from abroad Cangjun Zhou, from China’s EV Mengchen Wenzou, drew lessons from projects in Ethiopia. The first challenge is one well-known to South Africans – an unhindered power supply. “We need stronger transformers and upgraded grids.” The second challenge is that of s government planning. “Without long-term strategy and support, progress slows,” he said. His recommendation for South Africa was to focus on fast-charging infrastructure around 160 kW, which suits most vehicles in the mainstream market while being cost-efficient. Partnerships, he emphasised, are crucial – not only with government, but with local payment solutions. “The payment model affects how convenient EVs become. Every country needs its own solution.” He also announced that his firm would be building an assembly plant in South Africa, supported by local partners, aimed at serving the entire African market. “We hope South Africa will be the leader for green energy across the continent,” he said. Before NEVs there was GridCars For Winston Jordan, CEO of GridCars, the local EV-charging pioneer, the transition is already under way. “We started building charging infrastructure before EVs even arrived, back in 2011,” he said. “Now there are over 800 public chargers across the country and roughly 6 000 more installed in homes. So, the idea that South Africa isn’t ready simply isn’t true.” Jordan pointed out that charging in South Africa is cheaper than petrol by at least a third. Different chargers, speeds, and connections mean different prices. But the average driver pays far less than they would for fuel.” He also observed that the private sector should be driving the charging rollout, suggesting that government had more pressing priorities in delivering basic services. Nonetheless, Jordan issued a challenge to government to lead by example. “The biggest thing government can do is take the lead and set aggressive targets,” he said. “If the President announced tomorrow that all new government vehicles must be electric, it would send a clear signal to the market.” He also urged that the automotive sector look at targets closer than the South African Automotive Masterplan’s 2035. “The target of 2035 is too late; we need 2028 or 2030 at the latest.” Load shedding is in the rear-view mirror Eskom’s Mashangu Xivambu, responding to questions about grid capacity and energy security, was optimistic. “Load-shedding is now in the rear-view mirror,” he said. “We’ve had 157 consecutive days without it, and we’re learning from the past.”   Eskom, he noted, has already launched a pilot programme for EVs and has committed to converting its entire 8 700-vehicle fleet to electric by 2035. The utility is also installing solar-powered charging stations at its offices, including in rural areas, and plans to open charging points to the public. “People need to see that they can drive anywhere and still charge their vehicles,” he said. “If Eskom is doing it, others will follow.” The way forward The panel agreed that while technology is key, policy coherence and skills development are equally important. “We need a conducive environment to grow the NEV sector,” Shilubana said, adding an innovative idea that would draw attention of the public to the importance of green mobility. She suggested the use of green number plates on NEVs to help the public recognise them on the road and normalise their presence. “The more people see them, the faster adoption grows.” Jordan said that skills transformation must include retraining traditional automotive technicians. “The future is electric, but we can’t leave petrol-engine mechanics behind. We must upskill them for the next generation of vehicles.” By the end of the discussion, one message came through clearly: South Africa is ready, but urgency and alignment are essential. From AI-powered chargers to homegrown assembly plants, and from Eskom’s electric fleet to the private sector’s nationwide network, the building blocks are already in place. What is required is fearless leadership and an accelerated NEV rollout. As Jordan put it: “Electric mobility is not a choice between technologies, it’s a transition. The future is electric. The question is whether South Africa will be ready to lead or just follow.”

NEV Summit sets clear direction for South Africa’s green mobility future

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By Mandla Mpangase Day 1 of the New Energy Vehicles Summit provided much to think about. The opening day of the inaugural New Energy Vehicle (NEV) Summit in Midrand proffered a compelling combination of insights, inspiration and strategic direction, positioning South Africa, and Gauteng in particular, as a frontrunner in Africa’s transition to sustainable mobility. From the science behind hydrogen and battery-powered vehicles to the policies shaping South Africa’s green mobility roadmap, Day 1 covered a broad spectrum of issues. Delegates explored global trends, drew lessons from international case studies, including from China, and examined local readiness across policy, skills, and industry. In his summary remarks on the day, the CEO of the Tshwane Automotive Special Economic Zone (TASEZ), Dr Bheka Zulun, noted that the discussions were “not just about dialogue, but about direction”. Every presentation, he said, “was the emergence of a shared vision; one that sees South Africa transitioning into sustainable mobility and industrial renewal”. Gauteng, as the country’s industrial heartland, was described as playing a strategic role in the future of the automotive ecosystem, leveraging its strong logistics infrastructure and manufacturing base to attract investment and drive innovation. “Today affirmed South Africa’s readiness to lead Africa’s green mobility future,” Dr Zulu added. “The key message was about collaboration – between government, industry, academia, and innovators – to create jobs, empower small, medium and micro enterprises, and localise technology.” Dr Zulu likened this collaboration to a relay race, where each participant contributes their unique strength at different stages: “It’s not about competition, but coordination, knowing when and how to pass the baton to build momentum together.” Throughout the day, recurring themes included industrial transformation, skills development, and ensuring that technology and labour advance together for a just transition. Speakers also emphasised policy clarity and investment confidence, highlighting growing optimism in the local NEV manufacturing sector. The province called for “urban-driven industrialisation” that integrates energy policy, investment frameworks, and urban planning, aligning Gauteng’s innovation and logistics strengths to create a globally competitive green automotive hub. As the day concluded, participants agreed that the NEV revolution “is no longer a possibility, but a present reality”, and that South Africa’s leadership must act boldly and decisively to harmonise policy, infrastructure, and workforce development. “Our NEV transition is not a single-sector effort – it’s a national movement,” Dr Zulu emphasised. “We must plan boldly, invest bravely, and move together to make Gauteng cleaner, smarter, greener, and more connected.”

Future of auto industry at centre of national discourse – MEC Maile

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By Mandla Mpangase The discussion on the importance of new energy vehicles is taking place at a critical time in South Africa, where the future of the automotive industry is at the centre of national discourse, Gauteng MEC for Economic Development and Finance Lebogang Maile told the New Energy Vehicles Summit in Midrand today. The summit comes at a time when Gauteng is positioning itself as the automotive industrial hub for Africa, leveraging its existing automotive base, advanced logistics, and skills ecosystem. Critical to this positioning is the need to embrace the revolution that is the new energy vehicles (NEVs). Gauteng is determined to lead South Africa’s transition to electric and low-carbon mobility in line with global decarbonisation imperatives and the South African Automotive Masterplan 2035. “The South African automotive industry is facing a tough operating environment, heightened by the imposition of a unilateral 30% reciprocal trade tariff by the government of the United States, which has consistently been South Africa’s second-largest trading partner and key export destination for South African-manufactured vehicles,” Maile said, adding that on the manufacturing side, Original Equipment Manufacturers (OEMs) also face mounting challenges. South Africa’s automotive sector is particularly vulnerable to the 25% sectoral tariff imposed under Section 232 of the United States Trade Expansion Act of 1962, which specifically targets automotive exports. Key sector “The South African automotive industry is a cornerstone of the economy and contributes 22.6% to total domestic manufacturing output. It also directly supports over 110 000 formal sector jobs – a significant number in an economy that is battling with the creation of sustainable employment.” The MEC noted that a few months ago, naamsa (the Automotive Business Council) noted that the tariffs, and the broader uncertainty in our trade relations with the United States strike at the heart of South Africa’s industrialisation agenda and threaten future investment in high-value manufacturing. Mercedes Benz in East London, for example, exports at least 90% of its vehicles to the United States, making evident the impact of such an uncertain economic climate on the East London Special Economic Zone.   “Tariffs have had a severe impact on South Africa’s automotive industry, leading to a sharp drop in exports to the United States, job losses, company closures, and reduced GDP contribution of the automotive sector.” Vehicle exports to the United States have fallen drastically, with one report noting an 82% drop in the first half of 2025 compared to the previous year. Challenges “The industry has also experienced layoffs and job losses, with thousands of positions under threat due to companies losing contracts and reducing production,” the MEC said, adding that at least 12 company closures have been linked to these pressures, impacting the component manufacturing sector and its over 80 000 employees. Communities like those in East London, and the broader Eastern Cape, which are heavily dependent on the automotive sector, are at risk of economic destabilisation. Beyond job losses, the National Union of Metal Workers of South Africa (NUMSA) has also highlighted the risk of short-time that has been introduced at 26 companies in the Eastern Cape – many based in Gqeberha. “Various economists have identified three structural challenges that are currently confronting the automotive industry, specifically, navigating South Africa’s exposure to tariff barriers in the United States as outlined, the danger of dumping, and adapting to the global shift towards new energy vehicles,” said Maile. However, he noted, while these are real challenges with far-reaching implications, critical interventions can transform them into opportunities – particularly in relation to new energy vehicles. “New energy vehicles are crucial for South Africa’s future as they offer significant economic and environmental benefits, including reducing greenhouse gas emissions and lowering fuel costs, while supporting industrial growth and job creation through local manufacturing and infrastructure development.” New energy vehicles produce significantly fewer greenhouse gases and pollutants compared to internal combustion engine vehicles, which can help in combating urban air pollution and climate change. The place of new energy vehicles is also clear with their lower operating costs and potential for industrial growth, the MEC said: “Electricity is cheaper than petrol and diesel, and energy vehicles have fewer moving parts, reducing overall maintenance costs.” Additionally, as South Africa’s automotive industry contributes over 4% to GDP and 12.5% to exports, transitioning to new energy vehicles can safeguard this sector’s global competitiveness, especially with European Union bans on internal combustion engine  vehicles by 2035. New energy vehicles are also key to a Just Energy Transition, reducing reliance on fossil fuels, which can help reduce reliance on imported fossil fuels that are increasingly subject to price volatility. Recognising potential NEVs could position South Africa to become a hub for regional battery production and new energy vehicle technology. Recognising this potential, the national government has developed policies covering for NEV production, infrastructure, and skills development. “As a result of this intervention, a 150% tax rebate for new energy vehicle production starts in March 2026, with over R1-billion having recently been allocated to support local new energy vehicle and battery manufacturing.” The MEC said that such investments in local battery production address the salient challenge that new energy vehicles pose – mainly that they are significantly more expensive than internal combustion energy vehicles due to import duties and more importantly, a lack of local battery production. A strategy is currently being finalised to secure supply chains for critical minerals like cobalt, lithium, and nickel, which are essential for battery production. “This is part of a larger plan to beneficiate these materials locally instead of exporting raw forms.” This is in alignment with the Gauteng’s mineral beneficiation strategy that focuses on adding value to raw materials by transforming them into higher-value products, with a key role in refining precious and base metals. Developing local battery manufacturing capacity for NEVs, and mineral beneficiation broadly, will address economic diversification, ensuring that the province moves beyond raw material extraction to creating a more value-added mineral economy and to retain more wealth within the province and the country

From policy to action: Now is the time for South Africa to embrace new energy vehicles

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South Africa must move from policy to action as a matter of urgency, aligning incentives, infrastructure, skills, and industrial coordination around new energy vehicles, writes the CEO of Tshwane Automotive Special Economic Zone, Dr Bheka Zulu. [This article first appeared in Business Day – Time for SA to embrace new energy vehicles for export survival – 22 October 2025] South Africa’s automotive industry stands at a turning point. The global race toward low- and zero-emission mobility is accelerating, and for a country whose automotive exports hinge on access to the European market, embracing New Energy Vehicles (NEVs) is no longer optional, it has become an industrial necessity. The Electric Vehicle (EV) White Paper and the South African Automotive Masterplan 2035 (SAAM) together lay a strong policy and strategic foundation. The challenge now is moving from intent to implementation. The country has a clear opportunity to build an inclusive, competitive, and sustainable automotive industry powered by innovation, ready for a net-zero world. Transformation is a must The global automotive landscape is undergoing a profound transformation, driven by the urgency to reduce carbon emissions and achieve net-zero goals. The European Union’s carbon neutrality policies are among the most influential in this shift, setting strict timelines for phasing out internal combustion engine (ICE) vehicles and promoting zero- and low emission alternatives. The EU aims to be climate-neutral by 2050. The objective is to ensure an economy with net-zero greenhouse emissions. For South Africa, this presents both a challenge and an opportunity. The EU remains South Africa’s largest export market for vehicles, accounting for the bulk of automotive exports. A significant 68,7% of light vehicle production was exported in 2024, with three out of every four cars headed to Europe. This means that the EU’s green regulations will directly determine South Africa’s ability to continue trading competitively in this critical sector. Vehicles built in Gauteng and other parts of the country will increasingly need to meet low- or zero-emission standards to remain eligible for export. Transitioning now is not optional, it is essential. Early investment in NEV production, local battery manufacturing, and supporting infrastructure such as charging networks will safeguard South Africa’s market access, maintain its global competitiveness, and create a foundation for long-term industrial sustainability. Policy meets opportunity The EV White Paper charts a managed transition from internal combustion engines to cleaner technologies, ensuring decarbonisation does not lead to deindustrialisation. It sets out steps to localise EV production, develop charging infrastructure, and build skills for the future. The White Paper allows for a managed transition, setting out a number of processes: Developing domestic production and localisation of EVs and components; Phased fiscal support, import duty adjustments (especially for battery inputs), and tailored incentives to accelerate early uptake; Infrastructure requirements including charging networks, grid readiness, standardisation and inter-operability; and Mechanisms to coordinate across government, industry, labour and other stakeholders. It has identified 10 actions required to build an EV production ecosystem, including the beneficiation of critical minerals, battery reuse and refurbishment, regulatory alignment, and incentives for localisation. Complementing it, the South African Automotive Masterplan (SAAM 2035) envisions South Africa increasing local content in vehicle manufacturing, expanding exports, and doubling employment by 2035. SAAM 2035 sets out six focus areas: optimising the local market, developing the regional market, localisation, infrastructure development, industry transformation, and technology a skills development. Targets include: Increasing local content in assembled vehicles from around 39% to 60% by 2035; Growing South Africa’s share of global production to 1 %; Doubling employment in the sector across all tiers; Creating new tier-2 suppliers to broaden the supply chain, with a particular focus on black-ownership and localisation. Together, the EV White Paper and SAAM 2035 frame a just, inclusive transition that can preserve and grow the country’s industrial base. Driving Implementation Turning these policies into tangible outcomes depends on strong institutions. In Gauteng, the Gauteng Growth and Development Agency (GGDA), its subsidiary the Automotive Industry Development Centre (AIDC), and the Tshwane Automotive Special Economic Zone (TASEZ) are taking the lead. TASEZ, Africa’s first automotive city, is positioning itself as a hub for future-focused investment, where manufacturers and suppliers can plug into purpose-built infrastructure, training, and incentives. The AIDC, through its learning centres and supplier parks, is aligning skills and enterprise development with EV technologies. Together, these institutions are turning national ambition into provincial action. South Africa must act quickly to overcome power constraints, develop a local battery value chain, and align incentives to attract NEV and component investment. Global markets are already shifting and delays could cost South Africa export access, investor confidence, and thousands of jobs. A call to lead Africa’s NEV revolution The upcoming 2025 NEV Summit, hosted by GGDA, AIDC, and TASEZ on 22-23 October 2025 at the Gallagher Convention Centre, represents the next phase: uniting government, industry, and investors to accelerate implementation. From policy to action, South Africa’s NEV future depends on decisive execution. First published by Business Day Bheka Zulu: Time for SA to embrace new energy vehicles for export survival: 22 October 2025.