According to a Reuters report, South Africa is actively courting Chinese automotive manufacturers to establish local production facilities, with one company showing significant interest in building cars domestically, a senior government official announced on Wednesday.
Africa’s leading car manufacturing hub faces mounting challenges as domestic production falls whilst imports surge, particularly from China. The market has become increasingly competitive, with traditional players Toyota and Volkswagen now competing against Chinese electric vehicle giant BYD, Chery, Great Wall Motor, and Beijing Automotive Group.
Trade, Industry & Competition Deputy Minister Zuko Godlimpi told parliament that discussions are underway with several Chinese manufacturers about establishing local operations rather than importing finished vehicles.
"One area of their interest is to invest in hybrid vehicles and electric vehicles because that is the market that they are servicing globally," Godlimpi explained.
He revealed that one Chinese company met with the trade department in August, expressing interest in setting up operations in either East London or Port Elizabeth.
The push comes as Chinese automakers seek to escape a damaging price war at home by expanding into profitable African markets. Around 15 Chinese car brands currently operate in South Africa, including BYD and Chery, with Geely, Leapmotor, and Changan preparing to enter soon.
To protect domestic manufacturing, South Africa is reviewing its tariff regime. "We’ve been trying to move up to the highest ceiling of import duties to make sure that cheap imports do not price out South African-manufactured cars," Godlimpi said, noting such changes take time to implement.
The developments underscore South Africa’s strategic importance as both an African gateway and potential manufacturing base for Chinese companies diversifying beyond their increasingly competitive home market.
