In May, South Africa’s Department of Trade and Industry (DTI) announced its new approach to making the country, or at least its drivers, go green. The comprehensive plan includes incentives for both the manufacturing and consumer ends of the individual transportation market.
The DTI hopes to promote the establishment of an electric car industry — pushing South Africa to the cutting edge of automotive technology in anticipation of the future.
Not to be left behind
According to Trade and Industry Minister Rob Davies, who spoke in Johannesburg during the Electric Vehicle Industry Roadmap’s launch, South Africa should strive to stay abreast of eco-friendly technology and avoid being “left behind” on necessary initiatives.
He said the evidence makes a compelling case: the transportation industry needs to effect a carbon footprint reduction. It’s “absolutely evident” that auto manufacturers around the world must employ the technologies that will best reduce greenhouse gas emissions, Davies said.
On the list of environmental offenders, South Africa sits at unlucky number 13, which is a high rank for such a small nation. (Countries that top the list are China, Russia, the United States, and the European Union.) South Africa’s automotive sector emits around 20% of the country’s carbon, and it’s third on the list of industries that contribute to the country’s air pollution.
As difficult and unlikely as it may seem, the DTI hopes that a thriving electric auto industry will reduce the automotive sector’s negative impact on the environment, and stimulate economic growth by encouraging investment in the industry and creating new job opportunities.
The roadmap’s proposal
Drawing from the Council for Scientific and Industrial Research, the Department of Science and Technology, and the Industrial Development Corporation, the roadmap seeks to meet industry approval as much as it does environmental standards.
Manufacturers that begin producing electric cars will be offered an incentive package as part of the Automotive Production Development Programme (APDP). By including a “very generous quota” through which manufacturers can benefit under the APDP, the department hopes simultaneously to increase the number of cars made annually in South Africa (the goal is 1.2 million by 2020) as well as diversify the industry’s components chain.
To qualify, manufacturers would need to produce at least 5,000 electric vehicles per annum. The incentive is sweet: a 35% reimbursement on production costs to be doled out over a three-year period. As icing on the cake, the DTI is also considering a variety of tax incentive programmes similar to those used in the US, UK, and many other countries.
These should affect consumers directly by offsetting the price of a new “green” car at tax time.
A plan for everyone’s future
By engaging in talks with industry stakeholders like the National Union of Metalworkers of South Africa and the National Association of Automobile Manufacturers, and providing forums for public commentary, the DTI hopes to have the best possible plan in place by September, when it will place the roadmap before the Cabinet.
Davies recognizes, however, that the plan will need close monitoring and constant revision to keep up with so many high-paced technological advances.
So far, the plan has been a hit with the growing number of South African drivers as well as the South African auto companies. Mike Whitfield, CEO of Nissan South Africa called the plan “tremendous” and expressed his company’s willingness to offer their full support.
Cooperation between governments and industries, he noted, is important for successful legislation and to increase public awareness.
Toyota’s Johan van Zyl concurred: “…we have to work together to first of all establish the infrastructure.” He called the plan long term and pointed out that the technology is ready and waiting. He conjectured that in the future most vehicles will rely on alternative technologies, “It’s the right time to start,” he said.