Surge in electric cars may spark job losses
Global sales of electric vehicles are accelerating faster than expected — putting the economy of the Eastern Cape at risk.
In a nutshell, there are only about 20 moving parts in an electric engine, compared with nearly 2,000 in a typical internal combustion (ICE) engine.
That is a lot of parts which do not need to be made, which equals thousands of lost jobs.
The National Association of Automobile Manufacturers of SA predicts that the annual value of SA automotive exports will collapse from $10bn (R143.87bn) in 2019 to $2bn (R28.77bn) in 2040 if the country’s manufacturing is not converted to electric vehicles.
Looking at Eastern Capebased manufacturers, Volkswagen’s stated goal is for electric vehicles to account for 70% of its European sales by 2030.
At present, Europe is one of the main destinations for SAmade VW Polos.
Ford builds Duratorq TDCi (diesel) power trains and components in Gqebera.
Diesel engines are being banned in a growing number of countries around the world.
In February, Ford promised that, by mid-2026, 100% of its European passenger vehicle range would be all-electric or plug-in hybrids. The fleet will be all-electric by 2030.
Ford’s entire commercial vehicle range will be zeroemissions capable by 2024, with 75% of the company s commercial vehicle sales expected to be all-electric or plug-in hybrid by 2030.
Chinese vehicle manufacturer BAIC, which is yet to start production in its sprawling Coega SEZ plant, set itself the goal in 2017 of ending its production and sales of gasoline-powered vehicles by 2025.
It now sells about 18 EVs an hour in China under the BJEV brand, according to Forbes.
In July 2021, MercedesBenz announced it would have battery electric vehicles (BEV) in all segments the company serves by 2022.
From 2025, all new vehicle architectures will be electriconly and customers will be able to choose an all-electric alternative for every model the company makes.
A hybrid variant of the CClass
is being assembled in East London — which gives the Eastern Cape the opportunity to make the transition into electric vehicles.
This may not save jobs, but it will boost the 4IR capabilities of the province.
Isuzu, which builds bakkies in Gqeberha, has already been experimenting with electric delivery vehicles in the metro.
Gqeberha is a good place for electric vehicle development — it is the home of the uYilo e-mobility programme which has partnered with Nissan and BMW to test electric vehicles under SA conditions.
Other projects include a micro-electric mobility vehicle demonstrator, shared e-bikes for transport on the sprawling Nelson Mandela University campus and a fleet of vehicles used on a private game reserve.
uYilo is also benefiting from the UK governmentfunded PACT (Partnering for Accelerated Climate Transitions).
According to the uYilo website, the aim is to provide the empowerment necessary to enhance and sustain climate actions on accelerating emission reductions in the transport sector in SA.
In February, the uYilo eMobility programme was confirmed as implementation partner on sustainable transport in the SA-UK PACT country programme.
These are strengths which must be built on as the global market is switching to electric power much quicker than was previously predicted.
Which means that the Eastern Cape needs to plan now for job losses — and to implement a strategy.
Because of their dependence on the motor industry, Nelson Mandela Bay and Buffalo City in particular will need leaders who make it their mission to meet the challenge head-on.
The Automotive Production & Development Programme (APDP) and the SA automotive master plan are largely silent on electric vehicles.
Unless the Eastern Cape creates a unique competitive edge, the motor industry could well move offshore, as it has in Australia and New Zealand.
The province has already seen the departure of General Motors, as well as the on-off start-up of production at BAIC.
One of the scenarios is for SA to remain a manufacturer of “dirty” engines and vehicles for those markets which have not gone electric.
This is unlikely to happen without a concerted plan led and implemented by the provincial government, because of the limited local decision-making power of the component suppliers and OEMs.
With the existing OEMs going electric, it may be necessary to develop a range specifically for the market that cannot go electric (yet).
Looking to an electric future, one of the “quick wins” would be the building of an electric vehicle battery plant in either the East London or Coega SEZ.
The province’s expertise and strength in the use of composite materials should also be harnessed for the next generation of lightweight vehicles.
The opportunities in the support sectors such as the manufacturing of charging stations, solar arrays and charging cables should also be investigated.
At the same time, it is imperative to diversify the local economy and to have programmes in place to reskill the thousands of automotive workers whose jobs are at risk.