BMW i3 sales declined last year to 66 units, down from 93 units in 2016. Sales of the fully electric i3 have reached 32 units for the first five months of the year.
The i3 currently represents all electric vehicle (EV) sales in South Africa, as no Nissan Leaf sales have been recorded this year.
Range anxiety – the fear that the battery will run flat before the vehicle reaches its destination – remains one of the major factors inhibiting EV sales in the South African market, says BMW Group South Africa (BMW SA) BMW i and M specialist Alan Boyd.
“There are a lot of myths and a lack of knowledge in South Africa – even in the automotive industry – about EVs. Right now that is one of our biggest challenges,” he notes.
“People say the battery lasts one year, or that you can’t drive from Midrand to Alberton, and these statements are all incorrect.
“It is up to us to improve the knowledge around EVs in the local market.”
A second factor acting as a drag on EV sales is the lack of charging infrastructure in South Africa.
However, notes Boyd, “South Africans think they drive further than they actually do. If I use Norway as an example, which is a big EV market, most people charge their EVs at home, not anywhere else”.
When the i3 first arrived in South Africa in 2015, BMW i3 customers could charge at home, or at four local BMW dealers.
Now, however, there are 38 dealers where customers can buy, service or charge their i3s.
Charge points now number 57, which includes the 38 dealers, as well as a number of public charge points at shopping centres and wine estates, for example.
“Our commitment for EVs in South Africa stands,” says Boyd. “We’ll add more charge points this year.”
One exciting project could see BMW SA partner with a fuel company in South Africa to provide charging infrastructure at selected forecourts.
“But nothing has been confirmed yet,” says Boyd.
The higher price of an EV compared with an internal combustion engine vehicle also acts as a burden on sales, he adds.
“Price is a major concern for the South African public.”
The updated 94 Ah i3, launched in South Africa this month, is priced from R637 300 for the pure-electric i3 and R717 100 for the i3 REx, which has a range-extending petrol engine that functions as a generator when the battery nears depletion.
The lithium-ion high-voltage battery provides a customer range of 200 km for the pure electric vehicle, depending on the driver and selected route.
The REx model adds another 150 km to this number.
A 120 Ah model, to be launched in the not too distant future, will see range on the pure EV increase significantly.
“In three, four years’ time, we won’t be talking about range anxiety anymore,” says Boyd.
EV sales have, in general, enjoyed support from a large number of governments worldwide, in an effort to reduce the transport industry’s carbon footprint within cities, especially those battling pollution. This support has come through tax breaks, a reduction in the toll fees paid by EVs, to name but a few measures.
The South African government has not yet offered any support for the sale of EVs, despite attempts by local industry to solicit some form of incentive from Pretoria.
BMW SA in 2016 submitted a formal application to the International Trade Administration Commission of South Africa (Itac) for the reduction of the import duty on pure electric EVs.
The submission is for a 0% duty on the import of electric vehicles for a period of three years and, thereafter, for a 10% import duty to be applied.
Currently, EVs attract the highest import duties, at 25%, while, for example, imported vehicles under one-litre engine capacity from Europe attract no duties.
Also, under European Union (EU) trade agreements, normal imported vehicles with larger engine capacities attract duties of only 18%.
Boyd says BMW SA has not had any feedback from Itac at the time publishing.
EV incentives are not the only way in which government can assist with the expansion of emission-free driving, he notes. It could also provide land for charging infrastructure.
EV sales in South Africa should also be boosted by a greater variety of models, sold at different price points, says Boyd.
“We are a premium car manufacturer and our EV prices reflect that. Having more EV models on the road from other manufacturers will create a more balanced public view on the EV market.”
Jaguar and Audi have indicated that they may bring EVs to South Africa in the next four years.
BMW SA itself will consider broadening its local EV range as an increasing number of BMW EVs hit the road abroad.
The German manufacturer aims to launch the iNEXT from 2021, as well as the Concept iX3, and the iVision Dynamics. Electrified Mini models will also be added to the portfolio over the coming years.
According to one report, Bloomberg New Energy Finance’s ‘Electric Vehicle Outlook 2018’, the upfront cost of EVs will become competitive on an unsubsidised basis starting in 2024. By 2029, most segments reach parity as battery prices continue to fall.
SA EV Sales in Future
South African EV sales are not expected to track the steep global curve expected over the next few years, says Boyd.
One forecast shows EV sales increasing from 1.1-million units worldwide in 2017, to 11-million in 2025 and surging to 30-million in 2030.
“Sales are growing through government support and we don’t have any support at the moment,” says Boyd. “But, with the fast pace of battery development range anxiety should disappear and prices should stabilise.
“We should see a small growth in EV sales in general in South Africa over the next five years. As BMW SA we expect to see growth on EV sales in 2018.”