Amid the global automotive industry’s profound shift towards electric mobility and digital manufacturing, South Africa’s component sector is at a crossroads, with industry association National Association of Automotive Component and Allied Manufacturers (NAACAM) highlighting that the next decade will be defined by execution, investment and industrial agility.

The country’s automotive components sector is entering a decisive phase as the global transition to new energy vehicles (NEVs), automation and digitalisation accelerates.

While policy groundwork has been laid through the Automotive Production and Development Programme (APDP) and the recently gazetted Electric Vehicles (EVs) White Paper, NAACAM cautions that execution, policy coherence and investment mobilisation will determine whether the country retains its foothold in global value chains.

The next few years will test the sector’s ability to deliver on localisation and technology adaptation targets, says NAACAM policy head Beth Dealtry.

“The global automotive industry is rapidly evolving, and South Africa must be ready to compete within that transition. The EVs White Paper gives direction, but implementation at scale will be the real challenge,” she adds.

South Africa’s component manufacturers, which employ a substantial number of people and form the foundation of the country’s automotive export base, face complex pressures as new brands disrupt the market, international markets move towards electric and hybrid platforms, and the trade and energy environment remains challenging.

Dealtry notes that retaining global competitiveness will require a deliberate focus on cost, skills and technology partnerships: “For suppliers, especially in Tier 2 and Tier 3 firms, competing globally means reducing input costs and improving operational efficiency while aligning with environmental and digital manufacturing standards.”

Simultaneously, NAACAM emphasises the importance of scaling localisation in advanced component manufacturing to avoid further import dependency. This, Dealtry adds, will demand continued industrial policy support and deeper collaboration among government, assemblers and the supply base.

She highlights that for component firms to expand production and adopt new technologies, not only is policy coordination critical, but there is also a need for a stronger local-content framework and original-equipment manufacturer (OEM) production outlook to provide confidence for firms to expand production and adopt new technologies.

Building an Adaptable Industrial Ecosystem

Beyond electrification, Dealtry highlights the need for an industrial ecosystem that can accommodate existing vehicle platforms and emerging ones. This includes aligning skills development initiatives with automation, digital logistics and green manufacturing standards.

“Transitioning to NEV component production is not just about technology. It’s about ensuring [that] the workforce, infrastructure and policy frameworks evolve together,” she says.

NAACAM has been working closely with government and other sector stakeholders to strengthen supplier development programmes and support firms in adopting Industry 4.0 systems. These initiatives are viewed as essential for sustaining export competitiveness as global OEMs integrate more digital and sustainability requirements into their procurement standards.

Dealtry cautions that while the opportunity in EV-related components is real, South Africa cannot afford to lose ground in its existing export markets during the transition. She says the country must balance building capability for the future with protecting existing jobs and industrial capacity.

As South Africa moves deeper into the EV and green mobility era, the message from NAACAM is unambiguous: policy direction must be clear, but it is delivery, which must be swift and coordinated, that will make the difference. The coming decade will test whether the country can translate its manufacturing base, skills pool and policy vision into a sustainable competitive advantage.