South Africa’s EV market to hit $101m this year

January 29, 2025

From the newsletter

South Africa’s electric vehicle market size will hit $101 million this year, according to the South African government. It marks a sharp growth from a valuation of $84.9 million in 2023. This growth is expected to continue at an annual average growth of 8.73%, which will be driven by the declining prices of EVs.  

  • The country is investing in the production of new battery technologies through the Council for Scientific and Industrial Research (CSIR), together with one or two universities.

  • South Africa is aiming to serve as an entry point for the African continent for EV production. The country is already a leading manufacturer of ICE vehicles on the continent.

More details

  • According to Statista, the EV market in Africa is projected to reach a revenue of $223 million in 2025. This means that South Africa could contribute just under half of the continent’s total EV market this year.

  • South Africa’s EV market is rapidly growing. Last year, 1,257 BEVs were sold in South Africa, up 35% from 929 units sold in 2023. It is the first time that annual EV sales in the country breached the 1,000 units mark.

  • The size of the EV market in the country is however still small when compared to the entire automotive industry. In the overall market, 515,712 vehicles were sold in South Africa in 2024. That means EVs only had a market share of 0.24%.

  • Volvo is the largest-selling EV manufacturer in South Africa. Its most popular brand, the Volvo EX30, was the most sold EV in the country with 406 units sold in 2024, translating to 32.3% of the EV market. Volvo was followed by the BMW iX3 with 221 units sold, taking 17.6% of the EV market. Another Volvo brand, the Volvo XC40 was the third most sold EV. Some 103 units of the car were sold during the period, which is 8.2% of the EV market.

  • EVs in South Africa remain expansive, driven by tax disincentives on imports. The price of the Volvo EX30, which was the most sold EV in the country, starts at $43,000. Most of the other models of new EVs in the country are priced above $53,000.

  • South Africa is rolling out incentives to local EV manufacturers. Its government is seeking to attract more investors in EV production in the country. Starting 2026, companies investing in electric vehicle production will claim a 150% tax deduction on such investments. 

Our take

  • South Africa charges a higher tax of 25% on EV imports compared to 18% for ICE imports. There is also the ad valorem tax for EVs, which pushes the cost of an EV to more than double that of the average price of a new ICE vehicle of a similar make. The country should balance the need to protect its local EV manufacturing sector and make EVs more affordable to its citizens.

  • The recent entry of Chinese car manufacturers such as BYD and Dongfeng could prove to be a game-changer in the South Africa EV market. BYD has way cheaper models such as the Seagull (Dolphin MINI) which could land at a price point below $26,766. The company is already planning to expand its dealership in the country from 5 to 25 this year to better grasp the market.

  • It is almost a year since South Africa ended rolling power blackouts. The return of a stable power supply could be a key accelerator of e-mobility. This comes at a time when a lineup of new EV models are set to be launched by different manufacturers and dealers in the country this year. For South Africa to sustain its EVs rally, it must ensure that stable and affordable power is available.