Electric car sales surge in South Africa

Electric vehicle (EV) sales started with a bang in 2023, with 232 units sold in the first quarter of the year — nearly half the number sold in the whole of 2022.

This is according to the latest sales figures published in the National Association of Automobile Manufacturers of South Africa’s (Naamsa) quarterly review for Q1 2023.

Altogether, new energy vehicle (NEV) sales, which include plug-in hybrids, traditional hybrids, and fully electric cars, saw an increase of 18.8% in Q1 2023 over the same quarter in 2022.

Fully electric vehicles saw the highest proportional increase in sales when comparing Q1 2023 to Q1 2022.

These sales more than doubled over Q1 2022, when 112 fully electric cars were sold in the country, compared to 232 units in Q1 2023.

Moreover, looking at the years before 2022, more electric cars were sold in Q1 2023 than in the entirety of 2021, 2020, 2019, or 2018.

The chart below compares yearly electric car sales between 2018 and 2022 to sales in Q1 2023.

Electric car sales: 2018 to Q1 2023. Source: Naamsa.

Looking at NEV sales as a whole, these are also on the rise, with 1,665 NEV units sold in Q1 2023 compared to 1,401 in Q1 2022.

This is impressive as NEV sales in 2022 were significantly higher than in previous years. All-in-all, 4,764 NEVs were sold in South Africa in 2022, compared to 896, 324, and 407 in 2021, 2020, and 2019, respectively.

Naamsa notes that the uptake of EVs in South Africa has largely been hampered by the high upfront cost of electric cars in the country, despite their lower running costs.

“This is exacerbated by the effects of the value-added tax [VAT]; the ad valorem excise duty based on a sliding scale up to 30%, and the import tariff; limited product availability; and awareness issues emanating from range anxiety, security of electricity supply and a limited understanding of the technology,” it said.

A MyBroadband analysis revealed that after considering exchange rates and these taxes, the price of a bakkie after importing it to South Africa was around 89% higher than the retail price in the US.

For example, we compared importing a Ford F-150 Lightning from the US to South Africa.

The car, at the time, retailed for $39,974 (R619,835 at the time; now: R770,000), and after adding the various taxes, the price of importing the bakkie was R1,172,460.

Naamsa believes that to drive the NEV transition in South Africa, the country should incentivise a switch in the domestic market to NEVs, while expanding charging infrastructure and supporting a shift to NEV production.

While there is progress on the charging infrastructure side of things, manufacturers have been left in the dark about EV production in the country.

In April, Naamsa president Neale Hill said government urgently needs to announce its intentions on EV production or risk manufacturers pulling out of the country.

“South Africa has already missed the upcoming round of EV model investment, for which the decision date is three years before start of production, and realistically will only be considered for the next round of investment around 2030,” he said.

Acting director-general for the Department of Trade, Industry, and Competition (DTIC), Malebo Mabitje-Thompson, said the government has made it clear that it favours a manufacturing-focused approach.

However, she acknowledged that South Africa risks falling behind without a concrete policy on EV production.

“We don’t want to risk South Africa becoming the last place where internal combustion engines [ICEs] are produced while other markets are busy with EVs,” Mabitje-Thompson said.

A breakdown of NEV sales in South Africa from 2018 to Q1 2023 is provided in the table below. The data used is from Naamsa’s Quarterly Business Review for Q1 2023.

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