India leads but China narrows gap in South Africa's passenger vehicle track

China-assembled cars have doubled their share of the market

China’s share in the South African automobile market has been increasing faster than India’s.

 

And what makes the situation worse for Indian automobile players is the prospect of tariffs on imports of fully built passenger vehicles into the African country.

 

The data from JATO Dynamics shows India’s share in South Africa’s vehicle imports rising steadily over the past three years. Vehicles assembled in India accounted for 22.9 per cent of South Africa’s imports in CY2023, increasing to 27.0 per cent in CY2024 and further to 28.6 per cent in CY2025.

 

In contrast, South Africa’s own locally assembled vehicles saw their share decline over the same period, while imports from several traditional sourcing markets either stagnated or lost ground (see chart).

 

However, at the same time, a rapidly expanding Chinese presence in South Africa’s import mix is also reshaping market dynamics. Vehicles assembled in China have increased their share more aggressively than India’s over the same period and now represent a substantial portion of imports, particularly in entry-level and electric-vehicle segments.

 

This surge is one of the main factors in South Africa considering higher tariffs on imported cars. The country is weighing the introduction of sharply higher tariffs — potentially up to 50 per cent — on fully built passenger vehicles imported from India and China, as part of a wider effort to shield domestic manufacturing from a surge in foreign competition.

 

The move is being examined as part of an internal review by the country’s Department of Trade, Industry and Competition (DTIC), according to a Bloomberg report.

 

Ravi Bhatia, president, JATO Dynamics, told Business Standard that there was little evidence so far of any pullback in exports from India.

 

“South Africa has become one of the most important export markets for Indian manufacturers over the last few years, and shipments have continued to grow at a strong pace even as the tariff discussion plays out. Most manufacturers seem to be operating on the assumption that nothing is changing immediately, so production and export plans remain intact for now,” he said.

 

What’s driving the popularity of India-made vehicles in South Africa? Bhatia said Indian vehicles hit the sweet spot on pricing, specifications and right-hand-drive requirements.

 

Over time, India-built models, both from domestic ones and global brands sourcing from India, have moved from niche imports to mainstream offers with established dealer networks and service footprints.

 

That embedded position reduces the likelihood of a sudden unwind, even if trade conditions eventually tighten.

 

According to JATO Dynamics, the rate of growth in exports to South Africa has been running significantly ahead of India’s overall passenger-vehicle export growth. While passenger-vehicle exports from India have been growing in the low-to-mid teens, shipments to South Africa have expanded at a much faster 25-30 per cent range, outperforming regions such as West Asia and Latin America, and sharply contrasting with Europe and parts of Asia-Pacific, where volumes have been flat or declining.

 

Indian players are not just exporting vehicles to South Africa. Some are deepening their local market presence.

 

Tata Motors (passenger vehicles) recently re-entered the South African market after six years, partnering Motus Holdings as its exclusive distributor and launching multiple models including the Tata Punch, Curvv, Harrier and Tiago across an expanding dealer network. The company is targeting a 6-8 per cent mid-term market share and aims to challenge both established and Chinese competitors in key segments.

 

Mahindra & Mahindra (M&M) has also grown rapidly in South Africa, becoming one of the top 10 sellers and particularly strong in the pickup/utility segment.

 

The company last year reported significant year-on-year increases in sales and inaugurated an assembly facility in Durban.

 

Sources in leading manufacturers that export to South Africa said that they might use units in other geographies to export to South Africa. “This, however, will hit the Indian operation revenues. Players like Hyundai and Suzuki have plants in multiple locations, which they can tap into,” said one industry insider

 

Commercial vehicles likely insulated, for now

 

For CV makers, the immediate risk appears more limited.

 

Tata Motors’ Managing Director and Chief Executive Officer Girish Wagh noted the company was tracking developments closely and highlighted that current reports suggested the proposed measures might apply primarily to completely built passenger vehicles. “There is no clarity on whether this will apply to CVs or whether it will be restricted only to completely built units,” he said, underscoring Tatas’ ongoing local assembly operations in Rosslyn and the importance of the South African market to its truck export volumes.

 

Bhatia said: “Until something becomes official, exports from India to South Africa are likely to remain strong and continue growing faster than most other markets. The real risk is more medium-term than immediate, and manufacturers are aware that they may need to balance exports with deeper local engagement if trade rules eventually change.”