Swing to hybrids inevitable, says Toyota

Toyota South Africa Motors (TSAM) believes there will be a big swing towards hybrid vehicles in the South African market.

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The company has invested almost R3 billion in South Africa for the production of the new Corolla Cross sport utility vehicle (SUV) at its manufacturing plant in Prospecton in Durban, including a hybrid derivative of the Corolla Cross. This will be the first time TSAM manufactures a hybrid drivetrain vehicle, with both the 1.8 litre petrol and hybrid models exported to 43 countries in Africa.

TSAM president and CEO Andrew Kirby said during a recent State of the Motor Industry virtual presentation the Corolla Cross will provide motorists with access to an affordable hybrid vehicle.

“We haven’t had that before at an affordable price so I think the volumes will be significant. To do this on South African soil is good because it's obviously the future direction from a technology point of view.

“We have been wanting to not just sell hybrids but actually localise it. That is the big challenge for the whole automotive industry. How do we localise the whole electrification process in the future?” he said.

He said Toyota is projecting a 7% a year growth in the SUV market in Africa, which will provide significant growth opportunities for it to expand production of the new model. Kirby, who is also president of the National Association of Automobile Manufacturers of South Africa (Naamsa), highlighted the difficulty South Africa’s automotive industry has in positioning itself for its different customers.

He said the industry wants to position itself as a manufacturing hub for Africa but the direction Africa is going to take with internal combustion engine (ICE) vehicles will be “a little bit distinct” to the direction taken in South African and in its export markets.

“We have got to keep up with the electrification process in Europe because they are dominant and are our biggest export market. We need to position ourselves as being the dominant manufacturing hub for Africa and that is going to be more ICE [based] for many years to come. And then in South Africa, we will be somewhere in between those two, so it's not going to be easy,” he said.

Dr Martyn Davies, MD emerging markets and Africa at Deloitte and African automotive lead partner, said in November 2020 that China is expected to dominate the global electric vehicle (EV) market in the future.

Davies said there are more than 500 manufacturers of EVs in China and more than 1.1 million EVs will be sold in China in 2020, which was staggering.

“The Chinese will be dominant in post ICE vehicles around a few brands but not in every market. I think many of the German brands will prevail. They are just too strong. But they [Chinese] will make significant inroads, just as the Koreans have in ICE effectively in the last 15 years,” he said.

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