Volkswagen on electric vehicle offensive in South Africa

Volkswagen South Africa is working on a comprehensive electric mobility strategy with the purpose of laying a strong foundation for the introduction of battery electric vehicles into its key brands and removing the risk to its lucrative export business.

Thomas Schaefer, chairman and MD of Volkswagen in South Africa, said on Wednesday it was a myth if South Africa believed it could carry on producing vehicles with traditional engines when the rest of the world is going electric.

Schaefer said at the Festival of Motoring at Kyalami that the demand for traditional vehicles is reducing while demand for electric models is increasing. “We will face a time when traditional vehicles will get more and more expensive and electric vehicles cheaper. This could change overnight.

“In South Africa we cannot wait and see for forever, and that is why we engaged the department of trade & industry,” he said, in reference to recent discussions by Volkswagen, Nissan and BMW with the department about bringing the electric vehicle revolution to South Africa.

Schaefer said they had good engagements with trade & industry minister Ebrahim Patel in the past two weeks, where they showed the minister what the world was doing and where South Africa should be going, including with the South African Automotive Master Plan.

The Automotive Master Plan replaces the current Automotive Production and Development Programme (APDP) next year and runs until 2035. It makes provision for electric, hybrid and fuel cell vehicles.

‘We have to’

Schaefer believes from the engagement with Patel that there is a much bigger interest “to come along with us and decide on electrification of South Africa in the automotive space”.

“Will it happen overnight? No it won’t. But we have to. We cannot stay behind. We as a company export 70%. What if the rest of the world moves away from traditional engines and we are still producing with traditional engines. Our exports are in danger and so we need to get onto this bandwagon,” he said.

Schaefer said he is hopeful South Africa’s automotive industry could wrap up its discussions with the trade & industry department soon and come up with “a real plan”. He stressed that the plan would not be implemented overnight, saying they are talking about a 10-year transition period.

Mike Glendinning, director of sales and marketing at Volkswagen South Africa, said many countries in Europe are moving away from vehicles with internal combustion engines to electric vehicles, partly to comply with EU carbon emission requirements.

Glendinning stressed that South Africa would eventually be forced to follow suit but the successful introduction and marketing of affordable cars in South Africa, including electric vehicles, hinged on some key factors.

The most important of these are the need for government support in the form of incentives and the reduction of the 25% import tariff on electric vehicles to ensure improved affordability and pricing, as well as accessible and affordable charging infrastructure in the major cities and on the major roads, he said.

Glendinning referred to comments by Volkswagen Group CEO Herbert Diess at the company’s recent AGM about the group’s electrification offensive strategy, which includes plans to invest about €30-billion in electric mobility between now and up to 2023.

Glendinning said it was clear that in the future the electric car would be a key success factor in the automotive industry. He added that with the imminent launch of the Audi A3 electric vehicle, the Volkswagen brand was entering the third major chapter in its history following its launch of the “people’s car”, the Beetle, after World War 2, and the Golf in 1974.

Volkswagen in South Africa is in discussions with its headquarters to be considered for the range of Audi electric models and remains optimistic about introducing battery electric vehicles into its model range in the near future.

e-Golfs

He confirmed they would be bringing 60 e-Golfs into South Africa by the end of this year largely for testing and planning purposes and to generate media and customer interest.

Glendinning said it is the intention to expand this in 2020 with some Audi A3s as it actively engages with customers on the electric vehicle driving experience in the build-up to its new-generation Audi vehicle launch, which is planned for 2021.

“We want to show people that electric vehicles can be sporty, fun and can deliver an exhilarating driving experience,” he said.

“We are very excited about the opportunity that electric mobility brings to the future of the Volkswagen brand and this strongly supports our medium-term goal to future-proof our brand with innovative, compelling and desirable models that customers need.”

• This article was originally published on Moneyweb and is used here with permission