Toyota South Africa Motors has urged the automotive industry to embrace resilience and innovation as it navigates global volatility and technological upheaval. Speaking at the ninth annual State of the Motor Industry event, held under the theme Driving Through Disruption, President and Chief Executive Officer Andrew Kirby emphasised the need for decisive leadership and collaborative action to secure the sector’s future.
A Call for Resilience and Innovation
Kirby opened the gathering by acknowledging the unpredictable conditions facing both global and domestic markets. “We live in uncertain times, globally and here in South Africa. The question is not whether disruption will come but how we respond to it,” he said. He stressed that resilience, curiosity and continuous innovation would be essential qualities for the industry to thrive.
Sustainable Growth Beyond Entry-Level Models
While overall industry volumes have shown improvement, Kirby cautioned against relying solely on affordable entry-level models to drive growth. “It is not sufficient to only see volume growth stem from an increase in the entry affordable models as this does not have significant gross domestic product impact,” he explained. He also warned that exports alone could not fill the gap, given the tightening of global regulations and shifting market conditions.
Instead, he called for meaningful growth in completely knocked down production, which has declined despite broader gains. Toyota, he said, remains committed to shaping products and services around real-world needs while advancing industrial competitiveness through policy stability, local investment and deeper supply chain localisation.
Structural Challenges and Policy Adjustments
Kirby highlighted pressing structural challenges, including energy costs, logistics constraints, labour expenses and rising input costs. He noted that South Africa is showing early signs of premature deindustrialisation, with manufacturing value add per capita declining over the past two decades. “We cannot become a purely import-driven market. With the right small policy adjustments, we can strengthen competitiveness, attract new investment and grow the economy,” he urged.
Global Regulation and Export Risks
On international developments, Kirby welcomed the European Union’s revision of its 2035 emissions target from 100 percent to 90 percent for new cars and vans. This adjustment allows internal combustion engine and hybrid vehicles to remain part of the mix beyond 2035, provided they are supported by low-carbon fuels or other decarbonisation measures. “This pragmatic shift recognises multiple viable pathways to net-zero,” he said.
However, he cautioned that South Africa could not rely on a single export destination. With incoming emissions regulations in the United Kingdom and European Union, he warned that future export volumes were at real risk.
South Africa’s New Energy Vehicle Transition
Kirby pointed out that South Africa currently lacks a formal new energy vehicle target or regulatory framework, although additional investment support for battery electric and fuel cell electric vehicles will come into effect in April. “South Africa must set clear goals and supportive policies aligned to global trends to accelerate NEV adoption in support of our 2050 net-zero commitments,” he said.
He argued that hybrid electric vehicles offered the fastest way to reduce near-term emissions, complemented by plug-in hybrids and an expanding role for battery electric vehicles as infrastructure and affordability improve. “Our drivetrain mix will be determined by customer value, infrastructure readiness and use cases,” he explained.
Expert Perspectives and Economic Outlook
The event also featured a panel discussion with Professor Justin Barnes, who emphasised the urgency of infrastructure investment, industry-government collaboration and workforce readiness. Economist Goolam Ballim provided insights into global macroeconomic forces shaping South Africa’s outlook, reinforcing the need for agility in policy and industry responses.
Unlocking Growth and Jobs
Looking ahead, Kirby expressed confidence that with the right policy framework, South Africa could grow annual vehicle sales beyond 700,000 units and production beyond 720,000 units. This expansion could unlock an estimated R21 billion in additional manufacturing value add and create up to 14,500 new direct jobs. “We must not simply defend what we have, we must grow,” he said. “This industry has built deep capabilities over 100 years. With decisive leadership, collaboration and smart interventions, we can secure the next era of automotive manufacturing in South Africa.”
Urgent Alignment for the Future
Kirby concluded by calling for urgent alignment between government and industry as investment decisions for the 2029 to 2030 cycle approach. His message was clear: South Africa’s automotive sector stands at a crossroads, and only through resilience, innovation and collaboration can it drive successfully through disruption.
