Local Production of PHEVs Up 121% In South Africa In 2024

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South Africa hosts several vehicle manufacturing and assembly plants. Some of the automakers producing vehicles in South Africa include Mercedes-Benz, Ford, BMW, Toyota, Isuzu, and Volkswagen. Six years ago, I wrote an article on how South Africa could miss out on the massive opportunities presented by the EV transition if the country does not act fast enough. That’s because the auto industry is a key pillar of South Africa’s economy but makes ICE vehicles in a world moving quite swiftly to electric. According to South Africa’s Automotive Business Council, naamsa:

• The automotive industry contributes 5.3% to GDP [3.2% manufacturing and 2.1% retail];
• In 2023, the export of vehicles and automotive components reached a record amount of R270.8 billion, equating to 14.7% of South Africa’s total exports;
• The industry accounts for 21.9% of the country’s manufacturing output;
• Vehicles and components are exported to 148 international markets;
• The manufacturing segment of the industry presently employs on the order of 116,000 people across its various tiers of activity [from component manufacturing to vehicle assembly];
• Combined with the industry’s strong multiplier effect, the industry is responsible for approximately 498,000 jobs across the South African economy’s formal sector.

The problem is that, traditionally, over 99% of the vehicles manufactured in South Africa for export are full ICE vehicles and most of the countries where the vehicles produced in South Africa are being exported are seeing increasing adoption of electric vehicles. It’s probably best for the industry to start making moves to increase the share of electric vehicles produced in South Africa.

naamsa says that for the first time since the COVID-19 affected year of 2020, vehicle exports declined in 2024, to 308,830 units, down by a substantial 22.8% compared to the record performance of 2023 when the industry exported 399,594 units. Various factors impacted the plummeting in vehicle exports, including a slowdown in demand in the EU, the domestic automotive industry’s key export region, due to low economic growth, stricter emission rules, and competition from cheaper electric vehicle imports from China in the region, as well as the timing effect of new model introductions in the domestic market by major exporting OEMs. This decline means South Africa needs to act fast.

Well, it looks like there is some significant activity now on the PHEV side of things. Some of the OEMs producing vehicles in South Africa, including Mercedes-Benz and BMW, are now making plugin hybrids in South Africa, and a good number of these would have been part of the 308,830 vehicles exported in 2024. Just how many? naamsa says local production of PHEVs was up 121% in 2024 to 11,406 from 5,168 in 2023. If all of these were exported, it would mean about 3.7% of the vehicles exported from South Africa were PHEVs. Some of the PHEVs that are built in South Africa include the Mercedes-Benz C-Class PHEV and the BMW X3 PHEV. That means the share of full ICE EVs exported last yeas was 96.7%, an improvement form the 99% in most years.

Looking at PHEV sales on the local South African market, 737 PHEVs were sold in in South Africa in 2024, up 100% from 368 units sold in 2023. However, PHEVs only made up 0.14% of total vehicle sales in South Africa in 2024. Let’s have a look at the top selling PHEVs in South Africa. BMW’s X1 plugin hybrid topped the charts in 2024, selling 145 units. BMW took second place as well. The X3 registered 97 units in 2024. The plugin hybrid version of the BMW X3 is actually built in Pretoria, South Africa, which is a nice boost for South Africa’s assembly and manufacturing industry, which is dominated by ICE vehicle production. The other plugin hybrid vehicle that will be built in Pretoria starting later this year is the Ford Ranger PHEV. BMW’s X5 was joint 3rd with the Volvo XC60, with both models registering 74 units. These were followed by BMW’s XM and Volvo’s XC90, which registered 64 units each. So, BMW and Volvo dominated the sales charts in South Africa’s PHEV market. Interestingly, Volvo and BMW also dominate South Africa’s small but growing BEV market. BMW has been leading the charge to bring EV models in South Africa since the introduction of the first-generation i3, and it looks like together with Volvo, it will play a key role in increasing adoption of EVs in South Africa.

Looking at the PHEVs sold in South Africa in 2024, only the X3 on that list is locally assembled, and it sold 97 units. Meaning of the 11,406 produced in South Africa, over 99% of them were exported. Plugin hybrid electric vehicles (PHEVs) divide opinion all the time, as they have for years. A lot of people feel that with the way BEV tech has advanced in recent times, PHEVs are no longer needed as a transition option to full electric. However, as Dr. Maximilian Holland says, “BEVs pollute less than PHEVs, but the latter still have a critical role in certain niches where BEVs may not yet fully meet users’ needs. PHEVs (or EREVs) — when plugged in as designed — pollute a lot less than HEVs, which in turn pollute less than diesels! However, as we saw in markets such as China last year, PHEVs with longer electric mode range experienced significant increase in market share. As more of these ‘longer range PHEVs’ enter more markets around the world, will we see a resurgence in PHEV sales? Especially in developing markets where charging infrastructure may not yet be fully developed. Could PHEVs re-establish their role as a transition option to full BEVs in such markets?

“PHEVs with electric ranges of 200–300 km would appeal to non-early adopters, especially in markets where charging infrastructure is not fully developed. Perhaps this is what some Chinese automakers are thinking, as quite a number of them are contributing to a new wave of new-generation PHEVs with battery packs of over 50kWh and electric ranges of about 200 km — thereafter, complemented by a 1.5T or 2.0T ICE engine. In China and some other markets, PHEVs are now cheaper to buy compared to equivalent full ICE vehicles — from both an upfront purchase perspective as well as an operating or total cost of ownership (TCO) perspective. Could South Africa based automakers ramp up production of PHEVs to capitalise on this new wave and at the same time perhaps look seriously into adding BEV model production lines? Electric is the future, perhaps even the ‘Present” in many markets around the world, South Africa needs to add more production of plugins to boost the local car assembly market and hedge against planned registration restrictions around ICE vehicles in its key export markets.”