South Africa has secured commitments from Chinese and Indian automakers to upgrade semi-knocked-down operations to full-scale manufacturing. Trade Minister Parks Tau said discussions with companies like Toyota, Ford, and their suppliers aim to safeguard the industry’s future.
Industry leaders warned declining production, import competition, and the costly shift to electric vehicles threaten South Africa’s automotive sector. Speaking at the annual auto conference, Tau said companies in China and India have pledged to transition SKD operations to CKD.
SKD production assembles partially finished kits into vehicles, while CKD uses complete parts to build cars on site entirely. Beijing Auto Industrial Corporation assembles its X55 crossover in Gqeberha, a plant designed to eventually switch to full CKD production.
India’s Mahindra assembles semi-knocked-down pick-up trucks in Durban and is studying a potential full-scale manufacturing plant with local partners. The government plans to support these companies, aiming to strengthen domestic manufacturing and position South Africa as a continental hub.
Other investors in China and India have expressed interest in partnering with existing manufacturers or building new factories locally. Over 19 years, CKD vehicle sales fell from 56% to 33%, signaling a market increasingly dominated by imports, Toyota South Africa’s CEO noted.
Andrew Kirby warned sustaining CKD volumes is essential for preserving domestic industry, creating local value, and protecting economic benefits. Ford Africa president Neale Hill cautioned South Africa risks losing its century-long status as Africa’s top vehicle producer to Morocco.
