Former trade & industry minister Rob Davies said on Wednesday he was shocked by the degree to which imports had come to dominate the SA new-vehicle market.
It was revealed recently that imports, primarily from India and China, account for 64% of all new cars and bakkies sold here.
Davies was one of the architects of the government’s motor industry policy, the automotive production and development programme (APDP), which runs from 2021-35.
When he announced the terms of the programme in 2018, he said its aims included a doubling of industry employment and vehicle production, and a 50% increase in the local-content value in SA-made vehicles.
In fact, employment, production and local content have all shrunk since then — due partly to the economic effects of Covid but also to slow government response to changing circumstances.
The market share of imports has also grown well beyond the expectations of planners.
Davies, speaking in Gqeberha on the first day of industry association Naamsa’s annual Auto Week conference, said the dominance of imports was “astounding”.
Though the new-vehicle market is strengthening, SA’s vehicle production is down because imports are mopping up the extra demand.
It is estimated that at least 25 Chinese car and bakkie brands are now sold in SA.
Local vehicle manufacturers have responded by calling for higher import duties on built-up vehicles.
They also want the government to let them use the value of APDP import-duty credits, which they earn for production and local content, to reduce retail prices on their vehicles.
Andrew Kirby, president of Toyota SA Motors, told the conference that SA was in danger of becoming an “import replacement market”.
The immediate aim should be to create parity between imports and local products, at 50% each.
Current annual industry production, he said, was under 600,000. It should be more than 700,000.
Two-thirds of production was exported but the industry could not rely on exports indefinitely to underpin productivity — particularly as major markets such as the UK and EU were moving away from petrol and diesel internal combustion engines, which dominate South African production, in favour of electric vehicles.
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