Government pledges R1bn to kickstart South Africa’s local NEV push amid tariff shock

Brands984 words5 min read18 days ago

At the NAACAM Show in Gqeberha industry and government outlined measures to accelerate localisation, skills development and battery‑chain activity, while addressing energy, logistics and US tariff threats to South African vehicle and component exports.

NAACAM rolled back into Gqeberha from 12 to 14 August for its fourth edition NAACAM Show, staged at the Boardwalk Convention Centre in partnership with the AIDC Eastern Cape. The two-day conference and trade fair drew more than 2,500 delegates, visitors and exhibitors, and boasted over 120 component manufacturers and allied supplier stands that showcased South African manufacturing capability across the value chain. The event was framed to rally industry stakeholders behind the Automotive Masterplan 2035 and to accelerate localisation, skills development and regional market integration.

Senior executives, procurement and logistics managers attending the show heard that three linked constraints would shape the road ahead: unreliable energy and congested logistics infrastructure; the industry’s shift toward new energy vehicles (NEVs); and the impact of export barriers following higher US import tariffs. Delegates were briefed on the need to reconfigure supply networks to reduce dependence on single nodes and to invest in energy and freight pathways that support manufacturing and aftermarket distribution. The discussions acknowledged the external shock from the White House tariff measures as a compelling reason for closer government-industry collaboration on domestic NEV production.

Government outlined a package of measures designed to blunt shocks and attract investment into local NEV assembly and component production. A government allocation of R1 billion was announced to catalyse local NEV projects, with Treasury projections suggesting it could leverage roughly R30 billion in private capital. The briefing materials placed these measures within the framework of the Electric Vehicles White Paper and South Africa’s critical minerals strategy, aiming to stimulate localisation and battery‑chain activity in the near to medium term.

In his address, Trade and Industry Minister Parks Tau highlighted reforms to the APDP incentive framework and tax-based incentives for capital investment in NEV and hydrogen production. The reforms include shifting incentives toward rewarding local manufacturing and the introduction of a 150% capital allowance for qualifying NEV and hydrogen production assets purchased between 1 March 2026 and 31 March 2036. Tau also noted ongoing international engagement to address the effects of punitive import tariffs and referred to a forthcoming package of incentives for local NEV production alongside a skills development program being developed by Tshwane University of Technology, Cape Peninsula University of Technology and UNISA.

Tau also underlined the government’s focus on beneficiation of PGMs and other critical minerals for NEV components and the aim to reduce compliance burdens and red tape to speed up investment, with an intention to fast-track investments within 90 days. The government’s Critical Minerals and Metals Strategy and related measures were presented as supporting a broader push to grow the sector’s value-add domestically and attract greater investment.

The Eastern Cape’s leadership reinforced the national imperative. Premier Oscar Mabuyane opened Day 2 with a pledge that the automotive industry is the anchor of the region’s manufacturing value chain and that government would do all it could to protect this sector from job losses. He noted that delegates had highlighted energy and logistics concerns and said Eskom was planning high-level scope projects in the Eastern Cape with an investment value of about R2.5 billion between 2025 and 2030 to improve energy security for industry and households. Mabuyane concluded that the gathering was more than a discussion; it was a call to action to strengthen the automotive component manufacturing industry and to create a common future for the sector.

Minister of Small Business Development Stella Ndabeni-Abrahams acknowledged the robust discussions on regional growth, sustainability, global competitiveness and trade dynamics. She stressed that the government would listen to identify what more must be done, including policy tools, regulatory constraints, and implementation gaps, to foster a globally competitive yet locally inclusive automotive sector. She reiterated a commitment to localisation and regional value chains, and to building capabilities through technology development and the decarbonisation agenda, with co-created regional and continental markets underpinning a stronger supply chain.

Deputy President Paul Mashatile highlighted that South Africa’s automotive and manufacturing sectors operate in challenging times, requiring government-led collaboration with the private sector to address import dependence, infrastructure gaps, the EV transition, and tariff pressures. He stressed that the NAACAM Show provides a timely forum to outline the road forward for the sector, noting that the automotive industry remains highly strategic, accounting for about 22.6% of manufacturing output and 5.2% of GDP, with roughly 115,000 jobs, of which around 80,000 are in component manufacture. Mashatile argued for increased investment in research and development to harness technology for greater efficiency and sustainability and called for strengthened collaboration among manufacturers, suppliers and stakeholders to unlock new growth opportunities. He also pointed to AfCFTA’s potential to boost investment and integration across Africa, support regional value chains, harmonise regulations and reduce trade barriers, thereby broadening the continent’s automotive footprint. He closed with a call to intensify localisation efforts, suggesting a potential 5% uplift in SA localisation that could translate into about R30 billion in new local procurement and highlighting SA’s capacity to localise high-value NEV components, including fuel cells, thermal management systems, e‑axles and battery mineral beneficiation and assembly.

Following the Deputy President’s tour of the exhibition halls, thought leadership panels continued with discussions on B20 implications for industrialisation and the SA automotive sector, transformation of the automotive value chain to build scale for SMMEs, aftermarket demand as a growth engine, and the role of AI and smart manufacturing in the future.

The NAACAM Show 2025 closed with thanks to all attendees, delegates and exhibitors. A delegate summed up the sentiment: the discussions identified roads into the future and called for action to translate dialogue into investment, capacity building and logistics modernisation.

Photo Gallery

- End of article -

Source: Noah Wire Services

Article Insights

Keywords

automotivemanufacturinginvestmentindustrylocalisationdevelopmentenergyvalue

Main Themes

automotive
manufacturing
investment

Key Quotes

Government pledges R1bn to kickstart South Africa’s local NEV push amid tariff shock At the NAACAM Show in Gqeberha indu...

The two-day conference and trade fair drew more than 2,500 delegates, visitors and exhibitors, and boasted over 120 comp...

Mentioned In This Article

People

Paul Mashatile,South Africa,South African,Boardwalk Convention Centre,Eastern Cape and 16 more

Organizations

Government pledges R1bn to kickstart South,Africa,NEV push amid tariff shock At,NAACAM Show in Gqeberha industry and,US tariff threats to South African and 75 more

Locations

Gqeberha,Gallery

Share this article

Recommended Articles

Electric vehicle stocks accelerate as industry expansion attracts new investor enthusiasm

EV526 words3 min readabout 15 hours ago

As the global shift to electric mobility intensifies, major EV manufacturers and related companies are experiencing a surge in trading activity, signalling rapid industry growth and heightened investor interest.Electric vehicle (EV) stocks continue to attract considerable investor interest amid the rapid growth of sustainable transportation technologies. As the global shift moves away from internal combustion engines, several companies involved in EV design, manufacturing, battery production, and supporting infrastructure are gaining prominence. Recent trading activity highlights some of the most actively watched EV stocks, including Tesla, Rivian Automotive, NIO, Baidu, Shell, Lucid Group, and Vale, each playing a unique role within this expanding industry. Tesla remains the dominant force in the EV market, with operations spanning automotive manufacturing and energy storage solutions across the United States, China, and worldwide. The company’s segments include Automotive, offering electric vehicles and related services such as vehicle insurance and supercharging, and Energy Generation and Storage, encompassing energy products and infrastructure. Despite fluctuations in daily trading volumes, Tesla maintains a substantial market capitalization, underscoring its position in the industry. Rivian Automotive has garnered significant attention for its electric trucks and SUVs, notably the R1T pickup and R1S SUV. Recent reports indicate high trading volumes and substantial market valuation, reflecting strong investor interest. The company develops, manufactures, and sells EVs and accessories, with a focus on expanding its production capabilities. Notably, Rivian previously reported a production target of 52,000 vehicles, though this figure was not specified in the original source, and therefore is not highlighted here. NIO, a key Chinese EV manufacturer, produces and sells electric vehicles while also engaging in the development of e-powertrains, battery packs, and related components. Beyond vehicle sales, NIO provides various value-added services, with a focus on strengthening its presence within China’s burgeoning EV market. Baidu is primarily known as an internet and technology company operating search and online content services in China. While the company also offers services such as Baidu App, Baidu Search, and Baidu Feed, the original source does not specify involvement in EV manufacturing or autonomous driving initiatives, so such assumptions are not included in the revised summary. Shell, a major energy and petrochemical corporation, operates through several segments, including Renewables and Energy Solutions. Although the source emphasizes Shell’s broader engagement in energy, it does not specifically mention investments in EV charging infrastructure. Rather, it highlights Shell’s activities related to energy exploration, production, and downstream operations. Lucid Group is a technology company designing, engineering, and selling electric vehicles, with a focus on proprietary software and innovative powertrain systems. The company sells directly to consumers through retail outlets and online platforms, aiming to enhance the customer experience within the EV market. Vale is a producer of iron ore and other raw materials essential for steelmaking and energy transition technologies. The company operates through segments including Iron Solutions and Energy Transition Materials, providing resources needed for EV manufacturing and infrastructure development. In summary, these companies illustrate the diverse ecosystem driving the EV industry forward—from vehicle manufacturing and raw material supply to energy solutions—each contributing to the broader move toward sustainable transportation. Source: Noah Wire Services

U.S. auto industry faces rapid transformation as Japan and South Korea trade policies diverge in 2025

Policy865 words4 min readabout 15 hours ago

The U.S. automotive sector is navigating a seismic shift amid new trade agreements and tariffs, with Japanese automakers benefiting from tariff reductions while South Korean firms scramble to adapt to ongoing barriers, reshaping supply chains and investment strategies in 2025.The U.S. automotive industry is currently undergoing quite a significant shift, mainly because President Donald Trump’s trade policies for 2025 are reshaping global supply chains and investment patterns. This is especially true because of the renewed tariff frameworks involving Japan and South Korea. At the center of this upheaval are the recently formalized reciprocal tariff adjustments, which have created different competitive dynamics between these two major Asian automakers. Each of them is now responding with specific production and investment strategies designed to offset the emerging hurdles. What’s really driving this change is the U.S.-Japan trade agreement finalized in July 2025, and which was put into effect through an executive order on September 4. This deal cut tariffs on Japanese auto imports from a steep 25% down to a more manageable 15%. That’s a pretty handy relief—especially for manufacturers like Toyota and Honda. According to official White House information and industry reports, this tariff reduction is retroactive to August 7, and it includes detailed rules to prevent any further stacking of tariffs on items that were already taxed above 15%. In return, Japan has agreed to channel around $550 billion into U.S. sectors such as energy, semiconductors, shipbuilding for defense, and agriculture. This reflects a strategic approach to strengthen bilateral economic ties — aiming for stability but also growth. Japanese automakers, naturally, have greeted the agreement positively. Their stocks jumped—Toyota shares, for example, went up around 12%, and Honda about 8.4%, if you can believe it. Still, political nuances remain, with Prime Minister Shigeru Ishiba facing some challenges domestically, partly because of how the trade deal’s timing and impact are being perceived within Japan’s own industry landscape. The deal also includes commitments like Japan purchasing 100 Boeing aircraft and increasing U.S. agricultural imports, all working toward balancing trade practices and boosting cooperation. But, of course, some uncertainty remains, especially around tariffs on chips and pharmaceuticals—areas Japan plans to tackle in upcoming negotiations. Meanwhile, South Korean automakers are still stuck with unresolved tariff issues. The U.S.-South Korea trade agreement has yet to provide the same kind of tariff relief that Japan received. Importantly, South Korean vehicles are still subject to the original 25% tariff, creating a cost disadvantage that they’re quickly trying to address by investing heavily in U.S. facilities. Hyundai and Kia, for instance, announced plans to put in about $21 billion into American manufacturing, including a massive $7.6 billion plant focused on electric vehicles in Georgia. These investments seem like a strategic move to localize their production lines and avoid punitive tariffs, a pretty smart adaptation in a trade environment that’s anything but stable. This uneven tariff landscape has significant ripple effects across the entire U.S. auto supply chain and aftermarket sector. Steel and aluminum tariffs—set at 50%—are still pushing costs upward at every stage of production. Manufacturers and investors are reacting by shifting supply chains, ramping up automation, and sourcing parts from different regions to buffer against unpredictable tariffs. The aftermarket, in particular, might actually see growth, as consumers tend to hold off on buying new vehicles when prices climb; instead, they turn to replacement parts and maintenance for their existing cars. Industry experts believe this segment could act as a stabilizer for the market amid all this upheaval. Of course, legal uncertainties make long-term planning tricky. Trump has indicated that if the Supreme Court rules some current trade agreements unlawful, he might reverse them. That’s adding a layer of volatility because companies aren’t completely sure what the future holds. Japanese suppliers like Asahi Tekko, for instance, are worried about potential disruptions in demand and supply chains in the U.S. Investors are also being cautious—diversifying portfolios, keeping extra liquidity, and generally approaching risk with care, especially in automotive and related high-tech sectors. As for the U.S.-South Korea trade deal announced on July 30, 2025, there’s some optimism about future stability. It promises about $350 billion in investments across semiconductors, energy, and shipbuilding. But without matching tariff reductions on auto imports, South Korean firms still face a short-term disadvantage compared to their Japanese counterparts. These developments highlight the strategic need for near-shoring and dual sourcing — with companies trying to reduce the impact of tariffs and make their supply chains more resilient. Looking ahead, the automotive industry in the U.S. will have to adapt quickly. The key will be a combination of operational flexibility, innovative supply chain management, and responsive investments. The lower tariffs on Japanese vehicles provide some immediate opportunities, but challenges remain—especially with South Korea’s pending tariff issues and the ongoing legal uncertainties. Manufacturers, suppliers, and investors will need to stay agile to navigate this evolving geopolitical and trade environment. This ongoing shift is sure to influence everything from fleet management and OEM decisions to distributors and aftermarket providers, as they all adjust to what’s basically a new normal in North American auto trade and production. Source: Noah Wire Services

Tesla, Broadcom, and Texas Instruments lead the surge in industrial stocks driven by AI and electrification

Markets648 words3 min readabout 15 hours ago

Major industrial stocks like Tesla, Broadcom, and Texas Instruments are experiencing heightened trading volumes as their roles in AI, semiconductors, and energy solutions position them at the forefront of sector growth and innovation.Tesla, Broadcom, and Texas Instruments are currently among the most notable industrial stocks to monitor, according to MarketBeat’s stock screener, which highlights those with the highest trading volumes in the sector. Industrial stocks include companies involved in manufacturing, construction, aerospace, and transportation, serving as key indicators of overall economic health since their performance often mirrors business activity and capital expenditure cycles. Tesla, Inc. remains a prominent name in this space, known for designing, developing, and manufacturing electric vehicles (EVs), as well as energy generation and storage systems. Its main divisions are Automotive and Energy Generation and Storage. Tesla's product lineup features models like the Model S, Model X, Model 3, Model Y, along with newer offerings such as the Cybertruck and Semi truck. Based in Austin, Texas, and led by Elon Musk, Tesla operates globally, with manufacturing and sales networks across the U.S., China, and other international markets. Revenue streams include vehicle sales, regulatory credits, after-sales services, supercharging, merchandise, and vehicle insurance. Tesla's market valuation has been highly scrutinized. Its market cap has experienced fluctuations, reaching nearly $1.5 trillion at peak, before declining significantly. Currently, Tesla's stock largely reflects expectations of future technological advancements rather than just current vehicle sales. Notably, the company is investing heavily in areas like artificial intelligence, robotaxis, humanoid robots, and energy storage solutions. Analysts project a fourfold increase in Tesla's earnings by 2029, although some skepticism remains regarding the sustainability of these projections. A recent Financial Times podcast discussed that while Elon Musk's track record is impressive, concerns persist about whether Tesla’s lofty valuation is justified, especially given competitive pressures and governance questions. Broadcom Inc. is another key player, specializing in the design and supply of semiconductor devices and infrastructure software solutions. Their products include complex digital and mixed-signal CMOS devices, analog III-V products, and various software offerings. Broadcom's operations are divided into Semiconductor Solutions and Infrastructure Software, serving markets such as data centers, networking, broadband, wireless, storage, and industrial segments. Since the launch of ChatGPT in 2022, AI-related revenue has accounted for more than a quarter of Broadcom's total revenues and is expected to reach 30% by June. The company's sales are projected to surpass $80 billion by 2027, with AI equipment sales anticipated to grow by 160%. Unlike Nvidia, which primarily produces GPUs, Broadcom focuses on creating custom chips tailored for specific functions. The company has also engaged in extensive acquisitions, totaling nearly $100 billion since 2016, boosting its valuation. Its shares have risen by 16% since the U.S. midterm elections, outperforming many AI-focused competitors and indicating strong investor confidence. Texas Instruments (TI) is renowned for its design and manufacturing of semiconductors and integrated circuits. Its business segments include Analog and Embedded Processing. TI specializes in power management solutions—covering battery management, DC/DC regulators, AC/DC controllers, power switches, linear regulators, voltage references, and lighting products—that are essential for various applications across industrial, automotive, consumer electronics, telecommunications, and enterprise systems. TI’s expertise in analog and embedded processing positions it as a vital player in advancing energy efficiency and power control technologies across multiple sectors. Overall, Tesla, Broadcom, and Texas Instruments exemplify the dynamic evolution of the industrial sector amid rising integration with advanced technologies like AI, semiconductors, and electrification. For investors involved in supply chain, logistics, or energy management, observing these companies offers insights into industry trends and future growth prospects. Tesla's push into clean energy and autonomous vehicles, Broadcom's leadership in AI chip solutions, and TI’s dominance in analog and embedded tech are all shaping the industry’s future landscape. Their developments illustrate how interconnected and innovative this sector has become. Source: Noah Wire Services