Volkswagen Revs Up South African Plant for New SUV, Eyes Future Growth
According to Reuters, Volkswagen is stepping on the gas in South Africa, announcing a 4 billion rand ($210.67 million) investment to gear up its Eastern Cape plant for the production of a brand new SUV starting in 2027.
This move strengthens South Africa's position as Africa's leading car manufacturing hub, already home to giants like Toyota, Isuzu, and Mercedes-Benz.
The investment will see Volkswagen upgrade its facilities to accommodate this third model joining their production line. While the global auto industry shifts towards electric vehicles (EVs), Volkswagen acknowledges the continued demand for internal combustion engine (ICE) vehicles in African markets like South Africa. This is due to factors like consumer preference and a slower rollout of EV infrastructure.
"As most global vehicle markets transition to electric vehicles, African markets like South Africa will continue manufacturing and selling vehicles with internal combustion engines (ICEs) for the foreseeable future," said Martina Biene, head of Volkswagen Group Africa.
This strategy contrasts with stricter emission regulations in Europe and the US, where the EU aims to ban new CO2-emitting cars by 2035 and the US targets a significant increase in electric vehicle sales.
The first stage of the plant improvements will kick off later this year during the scheduled shutdown. While details like the SUV's name remain under wraps, Volkswagen teases that it will be designed in Brazil with input from their African team to cater to local and continental needs, including right-hand drive configuration.
This isn't the only exciting development for Volkswagen in Africa. The carmaker, which currently produces the Polo and Polo Vivo models in South Africa, also plans to introduce a test fleet of their ID.4 electric vehicle in both South Africa and Rwanda. This could signal future intentions for the brand's electric vehicle adoption strategy in Africa.
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Date of record
16 April 2024
