South African Car Exports Plunge on Stricter EU Emission Rules

By Simbarashe Gumbo

November 01, 2024 at 10:31AM EDT

New automobiles sit in the vehicle import yard at the Port of Durban, operated by Transnet SOC Holdings Ltd.'s Ports Authority, in Durban, South Africa, on Friday, May 25, 2018. Transnet last year reduced its seven-year capital-investment plan by 17 percent to 229.2 billion rand in response to lower-than-anticipated freight demand. Photographer: Waldo Swiegers/Bloomberg (Waldo Swiegers/Bloomberg)

(Bloomberg) -- South African car exports almost halved, partly due to a slowdown in demand in Europe because of stricter emission rules and competition from cheaper electric vehicles from China.

Exports fell 42.6% in October to 17,324 from a year earlier, according to the automotive business council, or Naamsa, data.

The European Union, South Africa’s biggest car export market, has been phasing in stricter rules to reduce the amount of carbon dioxide vehicles are allowed to release.

Still, Naamsa is optimistic that shipments could improve. “Easing of monetary policy in key export markets could see the vehicle export momentum turn positive again over the medium term,” it said.

The European Central Bank lowered interest rates for the third time this year in September.

Exports may also get a thrust from the EU imposing higher tariffs on EVs from China this week.