The ministers’ big gas consumers are approaching their expiry date

The days when government ministers rode in gas-guzzling luxury vehicles could be numbered – South Africa’s green procurement guidelines plan to curb officials who choose gasoline-powered vehicles when they are expected to switch to gasoline. green.

Spurred on by Minister of Transport Fikile Mbalula and Minister of Trade, Industry and Competition Ebrahim Patel, a number of actions aim to transform the automotive industry with a strong push towards electric vehicles in the part of its strategy towards a cleaner environment.

The government is moving towards environmentally friendly modes of transport such as electric cars. (AP Photo / Ariel Schalit)

“The green procurement guidelines that are set by both DoT and Dtic will provide a basis for how vehicle purchasing in government will play out in the future,” said Ayanda Allie-Paine, spokesperson for Mbalula.

Electric vehicles will be talked about as an integral part of a sweeping adoption leading not only to a reduction in the country’s carbon footprint, but also to the plan to create jobs and grow the economy by boosting the manufacture of these. vehicles as well as components.

She said the “Automotive Green Paper on Advancing New Energy Vehicles in South Africa” includes a commitment regarding possible adjustments to the green vehicle import tax regime, providing various incentives. to improve the adoption of electric vehicles, up to the development of green purchasing guidelines.

In a jointly funded project, the automotive industry body, the National Association of Automobile Manufacturers of South Africa (Naamsa) and Dtic recently commissioned a study of the incentive framework as part of the phase 2 of the Automotive Production Development Program under the South African Automotive Master Plan 2021-2035 program, which entered into force on July 1, 2021.

The plan aims to produce 1.4 million vehicles per year by 2035, doubling employment levels in the manufacturing sector and increasing local vehicle content from 40% to 60% on average.

According to the department’s green strategy, the national tax authorities may also benefit from the use of biogas or electricity as transport fuels, as these are produced locally, as opposed to gasoline / diesel, which are imported into the country. marginal level (or are made from imported crude oil, which is about 90% of their manufactured value).

This would represent a significant increase in local economic activity, with associated exchange savings (balance of payments) and the generation of more local taxes since a typical car consumes approximately two to three times more fuel than the cost of the vehicle. .

For higher mileage vehicles, such as minibus taxis, the cost of (imported) fuel can be more than 10 times the cost of the vehicle.

But green transport financing options and economic incentives to support green transport can come at a cost to motorists with a number of regulatory measures on the cards to raise funds. This could harm motorists who are already forced to pay a carbon tax on the purchase of vehicles, in addition to import duties, of up to 42% levied on new vehicles.

But the department wishes to promote a change in behavior towards sustainable mobility alternatives and ensure the low-carbon transition of the sector, by aligning and developing policies that promote energy efficiency and emission control measures in all modes of transport. . Carbon tax policy can meet the broader goal of reducing greenhouse gas emissions from climate change.

According to the United Nations Environment Program (UNEP), green transport is defined as support for environmental sustainability through, for example, the protection of the global climate, ecosystems, public health and natural resources.

It could also mean that motorists could also be hit with a congestion charge on vehicles entering central business centers. But international best practices in charging congestion areas will be taken into account before being taken into account.

Norman Lamprecht, head of trade, exports and research at the Naamsa Business Automotive Council, said on Friday that the green paper on the advancement of new energy vehicles (NEVs) in South Africa by Dtic had been drafted with the industry stakeholders. This strategy provides the rationale for moving towards new electric vehicles at the national level.

He said that as an export-oriented auto industry, nearly 64% of vehicles made in South Africa are currently exported to global markets. In 2020, three out of four vehicles were destined for Europe with the United Kingdom, the first destination country for the South African automotive industry between 2014 and 2020.

Europe is currently at the forefront of banning the sale of new internal combustion engine vehicles, recently announcing that it plans to move the date forward from 2035 to 2030.

Given Europe’s importance to the country’s auto industry exports, Lamprecht said South Africa plans to step up efforts in the electric vehicle landscape to boost domestic demand and focus in the future on the manufacture of electric vehicles and components for export markets.

“Hybrids, which fall under the definition of electric vehicle, are already manufactured in the country by Mercedes Benz (C-Class) while the Toyota Hybrid will be launched in October 2021,” Lamprecht said.

But he warned that the threat exists that the continent could increasingly become a dumping ground for internal combustion engine vehicles phased out in favor of electric vehicles in the future.

Lamprecht said the CO2 tax that consumers have to pay on vehicles aims to reduce the carbon footprint of inland transport, because electric vehicles do not emit harmful gases and therefore contribute to a cleaner climate.

Global electric vehicle sales increased in 2020, increasing 43% to 3.24 million units from 2.26 million units sold in 2019, despite the overall decline in new vehicle sales in 2020 due to the global Covid-19 pandemic.

Europe has supplanted China as a growth center for electric vehicles. In Africa, sales of new vehicles are very limited outside South Africa and the bulk of sales on the continent are used vehicles.

Between 2016 and 2020, sales of electric vehicles in South Africa totaled 472 units. Plug-in hybrid vehicles sold numbered 529 units and traditional hybrids totaled 784 units. During the same period, 1.4 million gasoline vehicles and 282,712 diesel cars were sold.

Lamprecht added that the consumer tax burden on new vehicles in South Africa was excessive and included in the order of 42% of the price of a new internal combustion engine vehicle.

“The price difference of electric vehicles compared to internal combustion engine vehicles and the limited choices available in the South African market would represent the main challenges at the present time. New technologies are normally expensive in the beginning until mass adoption of the technology occurs. Once more choice and cheaper models become available, sales of electric vehicles will increase, ”he said.

Swedish automaker Volvo has announced plans to sell only electric vehicles by 2030. In May, it released its first fully electric car, the Volvo XC40 P8 Recharge, due in South Africa in 2022.

“If we are to achieve our goals, we have to embrace the circular economy,” said Anders Kärrberg, head of global sustainability at Volvo Cars.

“It forces us to rethink everything we do and how we do it. We attach great importance to integrating sustainability into the way we think and work as a company, and we make it as important as safety always has been to us.

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