SA ‘doesn’t make sense for Tesla’, says Elon Musk

William Brederode - The "super high" import duties levied on electric vehicles in South Africa means that exporting cars to the country does not make sense for Tesla.This is according to the electric vehicle maker&#039;s South African-born CEO, Elon Musk, who was responding to a question on the issue on the X platform, formerly Twitter, on the weekend.A 25% import tax is levied on electric vehicles compared to the 18% duty levied on imported cars running using standard internal combustion engines.While several big-name brands, including Audi, BMW, Mercedes-Benz and Volvo, have electric vehicles for sale in South Africa, the market is still in its infancy, although it is growing rapidly.SalesThe National Association of Automobile Manufacturers of South Africa&#039;s third quarter business review showed that there was a 53% increase in the sale of electric vehicles from 2022 to 218. Sales of plug-in-hybrid vehicles grew even faster, more than tripling, but only to 89. Traditional hybrid sales just over doubled to 1 718.In a White Paper published late last year, the department of trade, industry and competition (DTIC) put forward its plan to transition the South African automotive industry from primarily producing internal combustion engine cars to a "dual plan" that includes electric vehicles in the consumption and production mix.The Electric Vehicles White Paper puts forward proposals to develop local electric vehicle manufacturing capacity to avoid the displacement of the local industry through imports, saying: “Allowing the South African automotive industry to decline without the appropriate support is thus not an option for the South African Government.”It also contemplates a temporary reduction on import duties for batteries in vehicles produced and sold in the domestic market to improve cost competitiveness. Batteries have historically been one of the most expensive components required to build an electric vehicle.IncentivesMore incentives to encourage the production of electric vehicles in South Africa are expected to be announced imminently as part of draft amendments to the Automotive Production Development Programme (APDP). This is expected this month.Finance minister Enoch Godongwana is also expected to announce tax and trade incentives for the industry in February.Ebrahim Patel, minister of trade, industry and competition, said in December that South Africa could start exporting electric vehicles manufactured locally by 2026. – Fin24

SA ‘doesn’t make sense for Tesla’, says Elon Musk

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Republikein 2025-04-07

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SA ‘doesn’t make sense for Tesla’, says Elon Musk

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