South Africa recently introduced a tax incentive to attract electric vehicle (EV) and hydrogen-powered vehicle production, drawing interest from Chinese automakers. The legislation offers a 150 percent tax deduction for investments in new-energy vehicle production. This move, signed into law by President Cyril Ramaphosa, has led to three Chinese automakers signing non-disclosure agreements related to potential investments in the country. While the tax break has been welcomed by the industry, challenges persist for South Africa's automotive sector in aligning with global trends like the EU's phase-out of internal combustion engines. The country's position as a major producer of essential minerals for EVs, such as manganese and platinum, further solidifies its role in the new energy vehicle market. Additionally, South Africa's tax incentive announcement coincided with China's proposal to impose export restrictions on EV-related technology. The Chinese government is considering limiting the export of battery cathode technology and mineral extraction techniques critical to EV production, which could impact global supply chains. This move is seen as part of broader trade tensions between China and the United States. South Africa's abundance of key minerals places it in a strategic position amidst the evolving global landscape. Industry analysts predict significant growth in the market for lithium-ion batteries and electric vehicles over the next decade. As China dominates global lithium processing, potential export restrictions from the country could have implications for Western automakers. The South African government is expected to engage with industry stakeholders to navigate these changes and support the automotive transition in the country.