Stellantis Contemplates New-Energy Vehicle Production in South Africa
Key Ideas
  • Stellantis is considering expanding its new car-manufacturing plant in South Africa to potentially include the production of new-energy vehicles (NEVs).
  • The decision is dependent on the emergence of a local market for NEVs and the regulatory environment, as South Africa is at risk of falling behind the global shift to electric vehicles.
  • The plant, located in Coega special economic zone, aims to start production of Peugeot Landtrek pick-up trucks by the end of 2025, with a goal of manufacturing 50,000 vehicles a year within 18 months.
  • The South African government is working on creating a conducive environment for NEV production, including reducing prohibitive duties on EV imports and developing a network of charging stations, to encourage local manufacturing and export of NEVs components.
Stellantis, a global auto giant, is considering expanding its first car-manufacturing plant in South Africa to potentially include the production of new-energy vehicles (NEVs). The decision, to be made by the South African unit's Managing Director Mike Whitfield, involves the possible expansion of the plant on the south-east coast. The company is contemplating manufacturing either hydrogen-powered vehicles or electric vehicles, both of which are not currently produced in South Africa. The move comes in light of concerns that South Africa's car industry may lag in the global transition to electric vehicles, especially in key export markets like the European Union. Whitfield emphasized the need for a local market for NEVs to justify the investment, highlighting that a significant portion of the output must be sold locally to warrant building the facility. Additionally, he proposed the idea of South Africa producing components for NEVs for export, rather than solely exporting raw minerals. The new plant, set to be constructed in the Coega special economic zone, aims to start producing Peugeot Landtrek pick-up trucks by the end of 2025. The target is to manufacture 50,000 vehicles annually within 18 months, with plans to increase production to 90,000 units. The South African government is also taking steps to support NEV production by addressing issues such as high import duties on EVs and the development of a charging station network. These efforts are geared towards fostering a conducive environment for local manufacturing and export of NEVs and their components.
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