MechChem Africa

Trevor Hill, head of Audi South Africa, believes that electrification is going to be driving the future of global mobility and that infrastructure for electric vehicles is becoming increasingly urgent in South Africa. Here he outlines a roadmap towards a competitive, premium solution.

South Africa can do more to create market access and deliver on an operating environment that makes for good business, says Trevor Hill – Head of Audi South Africa.

Audi a3 sportback etron charging“Competition in the premium automotive market is fierce but there is an elephant in the room. The demand we create for alternative mobility technologies – be it fully electric or hybrid – brings with it a very real infrastructure gap. Not addressing this today will, unfortunately, prevent any meaningful ability for the local automotive sector to competitively participate in global trends. Doing this right, on the other hand, would mean that we can deliver on local customer demand while still operating globally as a competitive automotive investment destination,” he says.

There is a firm reality; staying ahead of the pack means constantly innovating current technologies that, to a large degree, progresses the automotive segment as a whole. The downstream benefit of product innovation is clear, but it cannot be the job of the automotive industry alone. In the premium segment where the desire to drive ahead of the curve is expected, the introduction of new technologies around electrification and artificial intelligence creates real opportunity.

“What the South African automotive segment does not need is potential. What it does need is a practical and inclusive plan that supports the growth needed – and more importantly enables both education and adoption for a new world of mobility. To overcome the chicken and egg conundrum we suggest five key focus areas,” Hill argues.

  • “We need increased investment in building an infrastructure footprint that actually supports alternative mobility solutions: The automotive industry, in partnership with government and other industry partners, must fuel the development and implementation of charging stations around the country.

  • “We need a deliberate product road map matched to our infrastructure reality: Electrification won’t happen overnight, so we need to build a road map that accommodates hybrid vehicles and that can accommodate any future shifts to fully electric vehicles as and when new technology is phased in.

  • “We need a policy environment that makes good sense and enables the product and infrastructure needs: Currently import duties on electric vehicles are high. Electric vehicles get charged a duty of around 25%, while conventional vehicle imports get charged 18%. Additionally, an ad valorem tax, which is usually charged on luxury items, is also applied to electric vehicles. So the tax on electric vehicle imports stands at about 42% in total. Government needs to look at this policy and reduce import taxes to make the future of electric mobility less expensive.

  • “We need to increase the size of the pie. A clear and consistent growth plan creates a more stable business environment and more importantly, stabilises the currency fluctuation impact on the rand: Currently, the rand is the strongest it has been in two years. This is attributed to improvements in overall confidence because of increased political stability. However, what is concerning is the longevity of this stability and the resulting impact on the business environment.

  • “We need to make sure that we bring our customers and dealer partners on the journey with us: Education of customers and dealer partners is key. If consumers doesn’t understand what an electric vehicle is, they won’t buy it, even if they have the means. However, if they are educated about the positive impact such vehicles have on the environment, issues of versatility, power output and the technology behind it; then they are more likely to purchase the vehicle.

“We appreciate that any investment in alternative mobility solutions must be geared towards the end users of these solutions. What is important to understand is that consumers buy electric vehicles for different reasons. For some, it’s a lifestyle choice, wanting to drive green, clean mobility. While other consumers buy electric vehicles to make a statement. Given the environmental benefits, the latter group sees the technology representing cutting edge innovation and they want to be at forefront of this,” says Hill.

Customers also need the assurance and the necessary education to dispel any belief that electric vehicles lose the credibility and lack the quality of existing internal combustion engines.

Another key credibility factor for a more future forward mobility offering is the pace of infrastructure investment that our dealer partners would need to embark on in order to undeniably accelerate the adoption of alternative mobility. “As a direct importer, we need to invest time and effort to ensure that our dealer partners are willing and able to move their businesses in this direction,” Hill adds. Read more…

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