Ford Director Warns South Africa To Immediately Create An Electric Vehicle Policy

Ford warned the South African auto industry. (photo: twitter @FordPerformance)

JAKARTA – Director of Ford Motor Co. for Africa said the South African government must provide policy certainty regarding electric vehicles (EV) within six months to save its automotive industry.

Three-quarters of cars are produced by South Africa's auto industry, which accounts for 5% of the gross domestic product and provides more than 100,000 jobs, and is exported mostly to Europe.

But with the UK government planning to ban the sale of new petrol and diesel cars from 2030 and the European Union in 2035, local South African industries risk losing thousands of jobs and billions in revenue in the absence of government plans to migrate to electric vehicles.

"We need policy certainty, literally, in the next six months," Neale Hill, president of Ford Motor Company in Africa, told Reuters in an interview on Friday, November 18.

South Africa's Ministry of Trade and Industry said it had previously indicated a policy paper would be out in November 2021 but the deadline could not be met due to "multiple issues". "There is a commitment to resolve this issue immediately," he said.

The government issued the Automotive Master Plan in 2018 to help local manufacturers achieve 1% of global production, increase the use of local materials to 60% from 39%, and increase employment, among other goals. It does not include any policies regarding EV.

Hill, who is also president of the lobby for South African automaker NAAMSA, said auto companies wanted the government to clarify which parts of the master plan still needed support.

Ford in March increased its spending on electric vehicles to $50 billion through 2026 as the Dearborn, Michigan-based company tries to catch up with Germany's Volkswagen and current electric car industry leader, Tesla.

"It takes an automaker about four years to turn an investment decision into actual funding at a plant," said Hill. He added that car companies globally make such decisions and South Africa is not included in it.

"I fear that the (South African) government's delay and inaction in this regard will cost us a seat at the table," he said.