As the world embraces a transition to new-energy vehicles (NEVs), the South African automotive sector has an opportunity to build a more competitive and inclusive industry, according to naamsa | The Automotive Business Council CEO Mikel Mabasa.

During a Frank Dialogue discussion on August 28, he highlighted that as this shift in the sector took place, the automotive value chain itself would also change which, consequently, created economic opportunity.

“The transition creates something very valuable. It creates new markets and new markets create opportunities for new participants. The question is whether South Africa will recognise those opportunities early enough and whether [previously disadvantaged] South Africans will position themselves in order to capture those opportunities or not,” he said.

Mabasa argued that, while South Africa had spent decades building its automotive industry and manufacturing ecosystem, the economic ownership of that ecosystem had not transformed at the same pace as the industrial capacity of the sector.

Hence, while he acknowledged the progress made in participation in the automotive industry, he emphasised the need for genuine transformation, moving from participation and employment to enterprise and ownership.

Mabasa noted that only 1% of the R15.2-billion disbursed through the Automotive Investment Scheme has gone to black-owned projects.

“We cannot look at that number and tell ourselves that transformation is finished, because it is not,” he expressed, emphasising the need for faster and more effective transformation.

Therefore, he said the NEV transition provided an opportunity to ensure that value chains could be transformed in a way that enabled participation by previously disadvantaged persons.

“We have an opportunity because there's a new economy that is currently not existing that needs to be established.

“New battery systems, charging infrastructure, energy management, battery recycling and refurbishment, NEV diagnostic software and telematics, fleet electrification, new-vehicle data and many other opportunities have now come available for us to begin to explore in a very big way.”

Mabasa also emphasised the importance of building capabilities, skills and businesses that would allow South Africa to participate in and, ultimately, own the new mobility value chains that were emerging.

“We can watch the NEV transition happen to us, or we can deliberately position South Africa, particularly those historically excluded from economic opportunity, to own a meaningful part of this transition,” he said, reiterating the importance of using the transition to transform and create value to benefit the local economy.