South African renewable energy company Rubicon recently announced it was bringing the first Tesla Model X electric vehicle (EV) to South Africa.
There have been several instances of sought-after vehicles which are not sold locally being imported to the country from overseas, particularly by affluent businessmen and automotive enthusiasts.
However, despite the local popularity of its South-African born CEO, and the fact that it is now the world’s most valuable car brand, there are no other publicly recorded instances of Tesla’s cars making their way to South Africa via individual imports.
One major contributor to this may be the general lack of charging infrastructure in the country, with only a few stations located primarily within major metropolitan areas.
For those buyers willing to ignore this, as well as the possibility of having no after-sales support, the expensive import fees latched onto electric vehicles (EVs) might be more than enough of a deterrent.
Rubicon Energy and Electric Mobility Director Greg Blandford has recommended that South Africans don’t import these vehicles themselves, as the process is expensive and complex.
“The combination of customs duties, sales tax, and Ad Valorem duty (luxury tax) make it difficult to justify bringing in EVs to South Africa. The barriers for entry are just too high,” Blandford said.
Blandford laid out the tax and duty structure for Rubicon’s Model X purchase as follows:
- Vehicle retail price + 10% = Dutiable value for VAT purposes.
- Customs VAT is then calculated at 15% of this value and added to the retail price.
- On this total value, 25% customs duties for EVs are levied.
- Another 30% Ad Valorem excise duty is added as Teslas exceed the R600,000 bracket for luxury value.
He said that the end result was staggering, with 90% additional value added to the landed product in duties and taxes.
On top of this, Rubicon had to pay for the shipping of the vehicle to a South African harbour, which worked out to around €1,500 (R27,440).
Calculating the cost
Rubicon imported its Tesla Model X from the UK, as this is one of only two markets in the world where right-hand-drive Teslas are available.
It opted for the Tesla Model X Performance model, which offers around 487km WLTP range on a charge, 0-100km/h acceleration in 2.7 seconds, and a top speed of 262km/h.
Its most recent retail price was £96,900, or just over R2 million. However, it has been superseded by the Tesla Model X Plaid, which is yet to be released in the UK.
Based on Blandford’s explanation of how tax was calculated on Rubicon’s, we found the rough final price for bringing this type of Tesla into South Africa would work out to more than R3.8 million – around 90% more than its retail price.
A breakdown of this calculation can be seen in the table below, with the final price indicated in bold.
|Tesla UK to South Africa import taxes (£1 = R20.87)|
|Item||Individual costs||Total in rand|
|Tesla Model X Performance All-Wheel Drive||£96,900||R2,022,303|
|+ 15% VAT of 10% mark-up||R333,680||R2,355,983|
|+ 25% duty tax||R588,996||R2,944,979|
|+ 30% Ad Valorem tax||R883,494||R3,828,472|
Other Tesla imports
Using the same calculation as above, we also determined the cost of importing various other Tesla EVs from the UK.
For residents in that country, we found a range of models priced between £40,490 (R845,026) and £130,980 (R2.73 million).
However, getting one of these cars through customs would cost a minimum of R1.6 million for the Tesla Model 3 Standard Range Plus and can go up to R5.17 million for the recently announced Tesla Model S Plaid+.
This is without including the costs of shipping and shipping insurance.
The table below shows the UK retail pricing, as well as the total price an importer would have to pay with all duties and taxes included to get the car in South Africa.
|South Africa import and shipping costs for Tesla vehicles|
|Vehicle||Selling price||Total price (excl. shipping)|
|Tesla Model 3 Standard Range Plus||£40,490 / R845,026||R1,599,740|
|Tesla Model 3 Long Range AWD||£46,990 / R980,681.30||R1,856,552|
|Tesla Model 3 Performance AWD||£59,990 / R1,251,991.30||R2,370,176|
|Tesla Model S Long Range||£83,980 / R1,752,662.60||R3,318,009|
|Tesla Model S Plaid||£110,980 / R2,316,152.60||R4,384,766|
|Tesla Model S Plaid+||£130,980 / R2,733,552.60||R5,174,956|
|Tesla Model X Long Range Dual Motor AWD||£90,980 / R1,898,752.60||R3,594,576|
|Tesla Model X Plaid Tri Motor AWD||£110,980 / R2,316,152.60||R4,384,766|
Blandford said that before the car can be driven in South Africa, approvals are also required by the National Regulator for Compulsory Specifications (NRCS), which can include more costs.
“The process can be difficult depending on the application chosen for authorisation, but I must comment that the officials at NRCS are very helpful and professional.”
“Once the authority is received from NRCS the vehicle can then follow the rest of the vehicle registration and licensing processes,” Blandford added.
There may be further steps needed if the vehicle is second hand and in other special cases.
A possible change
It’s clear from this analysis that importing a Tesla vehicle would end up costing a fair bit more than the actual retail price, which could be a major deterrent for prospective buyers.
While electric vehicles carry a 25% import fee, fossil fuel-powered cars with conventional international combustion engines (ICE) can be imported to South Africa at 18% duty.
Many of these also don’t require any luxury tax like EVs, which have highly valuable battery packs that push up their price.
Blandford said that the simplest way for electric mobility to be stimulated in South Africa was to waiver import duties to 0% for five years and then gradually ramp up duties to level out at 18% as we currently have with ICE vehicles.
In addition, the Ad Valorem duty needs to be scrapped for EVs.
“This will encourage foreign investment and also create new opportunities in other business segments related to EVs such as charging infrastructure, energy storage and PV solar, which in turn creates local jobs.