South Africa Likely to Produce First EV in 2026: Minister

An electric car charging sign is seen in a car park at a petrol station in Sao Paulo, Brazil, March 3, 2018. REUTERS/Nacho Doce/File Photo Acquire Licensing Rights

JOHANNESBURG, Dec 4 (Reuters) - South Africa's automotive industry will likely produce its first electric vehicle (EV) in 2026, the trade minister said on Monday, as he outlined plans for the country's green transport transition.

The electrification of transport is one of the key pillars underpinning South Africa's Just Energy Transition (JET) plan for a low-carbon and climate-resilient economy.

The JET plan estimates that an investment of 128.1 billion rand ($6.84 billion) would be needed from 2023–2027 for the transport sector to contribute meaningfully to South Africa's decarbonisation commitments.

Based on discussions his department was having with the automakers, the first batch of EVs will be limited. Growth should then accelerate between 2026 and 2030, with only one manufacturer anticipating moving into battery electric vehicle production after 2030, he added without naming any brands.

In a 68-page EV plan, the government outlined steps to support the transition, such as government incentives, a temporary reduction on import duties for batteries in vehicles produced and sold in the domestic market, and the commercialisation of green hydrogen production as a source of sustainable fuel.

It will also reform network industries, including freight rail and ports and implement energy reforms.

The country's power crisis poses one of the risks as the country's state-power utility Eskom struggles to keep the lights on.

The effective bans on CO2-emitting vehicles from 2035 in key markets like the European Union and UK will be profound, as they absorb nearly half of South African auto production, the plan read.