Southern Africa has built its transport system around the fuel car for more than a century. That foundation is now being tested. In the past two years or more the conversation has shifted because the economics have shifted.
The widespread adoption of electric vehicles is expected to have a measurable impact on the cost of transportation, although the nature and timing of this impact will vary depending on vehicle category and operating context.
The initial capital cost of electric vehicles remains markedly higher than that of conventional vehicles. This price differential presents a barrier to entry, particularly for small-scale operators and for markets that rely heavily on second-hand vehicles. The mitigation of this barrier will likely depend on the development of specialised financing arrangements, leasing structures, and the eventual maturation of a secondary market for pre-owned electric vehicles.
An Analogy With The Cellphone Industry Introduction
The introduction of electric vehicles into the current Southern African transport market may be understood through the analogy of the emergence of mobile telephony in an environment previously dominated by fixed-line infrastructure.
For several decades, transportation in the region has operated within a system analogous to that of landline telephony. Internal combustion vehicles are supported by an extensive and well-established network of fuel supply, maintenance, and financing. This system is familiar, widely accessible, and functionally reliable. However, it is also characterised by high and recurring operational costs, primarily driven by fuel expenditure, and by a structural dependence on a centralised and imported energy commodity. In this respect, it mirrors the limitations of fixed-line networks, which, while dependable, were constrained by location, cost per unit of use, and the expense of expanding physical infrastructure.
The introduction of the electric vehicle may therefore be likened to the introduction of the mobile telephone. Initially, the technology presents as capital intensive and operationally unfamiliar. It requires the development of new supporting infrastructure, such as charging facilities, as well as new technical competencies for maintenance and new financial instruments to address the higher acquisition cost. Consequently, early adoption is met with caution, and incumbent technologies continue to dominate.
However, the defining characteristic of this analogy lies in the shift of the underlying cost structure. Mobile telephony did not merely offer an alternative means of communication – it fundamentally altered the economics of access by decoupling service from fixed infrastructure and by reducing the marginal cost of connectivity over time. In a comparable manner, electric vehicles alter the economics of mobility. By substituting electricity for liquid fuel, they reduce the variable cost of operation substantially, particularly for high-utilisation applications such as public transport, freight, and commercial fleets. As charging infrastructure expands and as technical and financial ecosystems mature, this advantage is likely to become more pronounced.
Furthermore, as was observed with mobile telephony in many African markets, electric mobility may follow a pattern of technological leapfrogging. In contexts where the cost of extending and maintaining the incumbent system is prohibitive, new technologies that operate on different infrastructural and economic logic can achieve rapid uptake within specific, high-value segments, even in advance of broader market transformation.
In exploratory terms, this analogy suggests that the significance of electric vehicle adoption in Southern Africa is not limited to the replacement of one propulsion technology with another. Rather, it represents a potential reconfiguration of the cost basis of transportation, with implications for affordability, accessibility, and the structure of mobility services across the region.
Vehicles Based on Fuel (for Mobility)
Fuel has become more expensive and unpredictable. Electric vehicles have become cheaper to buy. The electricity grid, after years of instability, has become more reliable in key areas. Together these changes have pushed electric mobility from a niche interest into a practical calculation for businesses and households.
The economics are now measurable. In Southern Africa in 2025, a mid-size petrol SUV uses approximately R2.10 per kilometre, based on an average fuel price of R23.50 per litre and consumption of 9L/100km. This figure varies by country and fuel price. At the same time, the cost of entry-level battery electric vehicles has declined with the arrival of new models from Chinese manufacturers, though most EVs still carry a purchase premium compared to equivalent petrol vehicles.
Electric vehicles demonstrate significantly higher energy efficiency than vehicles powered by internal combustion engines. This energy cost per kilometre for a conventional petrol SUV is substantially greater than that of a comparable electric vehicle. For operators with high daily mileage, such as minibus taxis, delivery services, and public transport providers, these efficiencies accumulate into considerable annual savings. Over time, this reduction in marginal operating cost may place downward pressure on passenger fares and logistics tariffs.
Battery Electric Vehicle
A comparable battery electric vehicle charged at home costs between R0.40 and R0.70 per kilometre, and even less when charged from rooftop solar. Fleet operators running 200km per day can recover the higher purchase price within 3 to 4 years through fuel and maintenance savings alone.
Battery electric vehicles are different. Their advantage is not in long rural trips today but in predictable, repeated travel. For fleets that return to a depot each night, for urban commuters with fixed routes, and for households that have invested in rooftop solar, the cost per kilometre drops dramatically. Charging at home overnight or during the day from the sun costs a fraction of filling a petrol tank. Maintenance is also simpler because there are fewer moving parts and no oil changes. The trade off is that long trips still require planning around charging points, and the upfront purchase price has until recently been out of reach. That is changing quickly with the arrival of new models from Chinese manufacturers priced within reach of the segment where most Southern Africans buy their cars. As these vehicles become more common, and as charging becomes available at shopping centres, workplaces and along major highways, the battery electric car will move from early adopters into broader use.
Hybrids
The gap is narrower for hybrids (use both a petrol engine and an electric battery/motor to drive, so it uses less fuel but you still refuel at normal petrol stations) which typically deliver 20 to 30 percent fuel savings with no change to refuelling habits. These figures change by country, but the direction is the same across the region – running costs now favour electrification where travel is predictable.
Hybrids, as stated above, occupy the middle ground and are likely to be the vehicle that thrives first in the mass market. They require no new infrastructure because they refuel at the same petrol stations, yet they cut fuel use through regenerative braking and electric assist. For a driver who is uncertain about charging or who needs one vehicle to do everything, the hybrid removes risk while still delivering savings. This makes them a natural bridge during a period when charging networks are still expanding and consumer confidence is still building.
To understand where we are going, it helps to compare how the different vehicle types actually perform in the context of our region – the southern African continental region. Petrol and diesel vehicles still offer the greatest freedom for long distance travel. A single tank can take a driver across provinces or countries within southern Africa without planning, and refuelling takes only a few minutes at fuel stations that are present in almost every town. Maintenance is familiar and uses parts are widely available. The weakness, however, is with the running cost. Every kilometre depends on a fuel price that is set by global oil markets and paid for in foreign currencies. When that price rises, transport becomes more expensive for everyone, from the commuter to the farmer to the retailer.
Potential Decline in Costs
This shift in operating cost also creates an opportunity to reconfigure where value is captured in the mobility value chain. Instead of exporting money for imported fuel, the region can invest in locally generated energy and manufacturing.
Insurance costs are currently elevated, largely as a result of limited repair infrastructure and the high expense associated with battery replacement, but these are anticipated to decrease as technical capacity expands.
At the same time, increased demand for electricity to support vehicle charging may influence municipal tariffs, particularly during peak periods, unless managed through strategies such as off-peak charging and the integration of renewable energy and storage. Additionally, the decline in revenue from fuel levies will necessitate the introduction of alternative mechanisms for funding road infrastructure, such as distance-based road user charges.
HAS FUEL SERVED US WELL?
Looking back, the fuel era has not served Africa well in structural terms.
We import both the vehicles and the fuel to mobilise them. Every increase in the oil price flows directly into the cost of food, goods and services. Very little value is retained locally beyond retail and repair. Profits, technology and manufacturing jobs accumulate elsewhere. The system also concentrates risk. When fuel rises or when the national power utility struggles, the whole economy feels it at once because there are few alternatives.
THE ELECTRICITY ERA
The electric era offers a chance to reverse that pattern.
Energy Is a Local Asset
The most important shift is that energy can become a local asset instead of a permanent import.
Sunlight and in some countries hydro-power are abundant across the region. When a vehicle is charged from a home solar system or from a depot with its own panels, the money that would have left the country for oil stays in the local economy. Over time this reduces exposure to global fuel shocks.
A New Value Chain Evolving
There is also an industrial opportunity that did not exist before.
Africa can capture more of this value by assembling vehicles locally, producing battery packs, manufacturing chargers, and developing services around energy management and software. This would create jobs not only in factories but also in installation, maintenance, and technical support.
The world is building a new value chain around batteries, charging equipment, software and power management. Africa holds a large share of the minerals needed for batteries. If policy is deliberate, the region can move beyond simply importing finished cars. Owning minerals is not enough.
Today, Africa exports raw lithium, cobalt and manganese, while 80 percent of battery cell production happens in China. To capture value we need investment in refining, cell production and pack assembly tied to local content rules. Partnerships should require assembly and skills transfer in the region. We must also build recycling capacity now. By 2035 the southern African continental region will face thousands of tonnes of used EV (Electric Vehicles) batteries. A circular system for second-life storage and recycling will prevent a new waste and import problem. Africa can
• Assemble vehicles locally,
• Produce battery packs,
• Manufacture chargers, and
• Even develop services around energy management.
That would create jobs not only in factories but also in installation, maintenance and software. Without such a strategy, the risk is that we swap one form of import dependence for another.
Emissions and the Grid
Electric vehicles (EVs) are only as clean as the electricity that charges them.
In countries where coal still dominates generation, tailpipe emissions are replaced by power station emissions. Even on a coal-heavy grid, lifecycle studies show that electric vehicles produce fewer emissions over their lifetime than comparable petrol vehicles. The climate benefit increases as the grid adds more solar, wind, and hydro. The immediate benefit for cities is improved local air quality, with no nitrogen oxides or particulates from buses and taxis operating on fixed routes.The climate benefit grows as the grid adds solar, wind and hydro. The immediate benefit for cities is local air quality – no NOx or particulates from buses and taxis on fixed routes. Policy should therefore link EV rollout to renewable energy expansion.
Resilience
The other benefit is resilience.
A system that includes petrol cars, hybrids, battery electrics, solar charging and storage is diversified.
• A logistics company that charges trucks at its own depot is less exposed to fuel hikes and power cuts.
• A city that electrifies its bus fleet on fixed routes gains both lower operating costs and cleaner air.
• Households that use an electric car with vehicle to load capability gain backup power during outages.
This kind of flexibility was not possible in the fuel monopoly.To turn this potential into reality, three things must happen:
• First, the cost of entry must come down. Southern Africa’s current tariff structure often makes electric cars more expensive to import than petrol cars, which works against the national interest. Import duties vary by country of origin and vehicle category, and in some cases they invert the incentive by penalising the vehicles with the lowest operating cost. Fiscal tools should equalise duties and ideally set lower rates for affordable EVs aimed at the mass market. Accordingly the tariff regime currently penalises EVs. For example, South Africa applies a 25 percent import duty on internal combustion vehicles and 18 percent on EVs from the EU, with higher rates for imports from China where most affordable models now originate. This inverts the incentive. Governments must also plan for lost fuel levy revenue and introduce road-user charges that are technology neutral. Without these changes, the cheapest vehicles to run will remain the most expensive to buy. Fiscal tools should instead encourage affordable models aimed at the mass market and support financing that reflects the lower running costs of electric vehicles.
• Second, the ecosystem must be built in parallel with the vehicles. Charging needs to be treated as essential infrastructure, available at workplaces, retail sites and along national roads. However, infrastructure must match ambition. Many municipal substations cannot support multiple 60kW to 120kW chargers without upgrades. Charging should be paired with solar and storage at depots and malls to reduce grid load. For long distance travel, the priority corridors are clear: the N1, N2, N3, N4 (within South Africa) and various routes to neighbouring capitals need fast-charging depots for every 150km. Without this, range anxiety will keep EVs in cities. Public and municipal fleets should lead, but only where depot charging can be guaranteed because their predictable patterns make electrification straightforward and create demand that private investors can follow.Building codes should make it easy to install chargers in new developments. Where the grid is weak, off-grid solar charging hubs can fill the gap.
• Third, industrial policy must focus on value capture. Tax incentives for manufacturing are a start, but they must be linked to local content and skills development.Partnerships with global manufacturers should include assembly in the region, not only imports. Training programs must prepare mechanics, electricians and technicians for a fleet that runs on software and batteries rather than only on engines.
Fuel Vehicles Will Remain Useful
Fuel cars will remain important for many years, especially for long haul transport and in areas where charging is not yet available.
Hybrids will dominate the transition because they are the easiest step for most buyers.
Battery electric vehicles will thrive first in cities, in fleets, and in homes with solar, and then expand outward as prices fall and infrastructure grows.
Most vehicle purchases in Southern Africa are not new. More than 70 percent of cars enter the market as used imports. Without battery health certification and diagnostic capacity, the region risks importing end-of-life vehicles with degraded batteries. Import standards and testing facilities must be established now to ensure the used EV market supports the transition rather than creating a new waste and reliability problem. The transition will only be mass-market when 5 to 8 year old EVs from Asia and Europe arrive with verified battery health and warranty support. We need import standards and diagnostic capacity now, not in 5 years.
Equally, the transition must include the vehicles that move most people and goods including minibus taxis and small trucks. Financing products that account for lower running costs, and incentives for fleet operators, will determine whether the benefits reach commuters and small businesses, or remain limited to high-income households.
The fundamental choice is not simply between fuel and electric. It is between continuing to import both vehicles and energy, or using this transition to produce energy locally and to build new industries around mobility. If Southern Africa acts decisively in the next few years, it can turn a transport cost into an economic opportunity. If it waits, it risks missing the chance to shape the new system and will instead adapt to decisions made elsewhere.
In conclusion, while transportation costs are likely to remain heterogeneous in the short term due to elevated acquisition prices, the lower marginal cost of electricity indicates that a structural decline in the overall cost of mobility is probable over the medium to long term. The achievement of this outcome will depend on addressing complementary challenges related to infrastructure development, energy management, and economic accessibility. Whether Southern Africa captures this transition as an economic opportunity or merely absorbs it as a cost will depend on decisions taken on tariffs, infrastructure, and policy in the next three years. Acting decisively now can turn transport from a recurring expense into a platform for local energy and industry.