THE MIDDLE EAST IS BECOMING A HUB FOR ELECTRIC VEHICLE DEVELOPMENT
The Middle East is rapidly becoming a regional leader for the adoption of Electric Vehicles (EVs). The Ministry of Energy in the Middle East launched a new incentive program in May 2017. It will encourage motorists to buy new zero-carbon-emission electric vehicles through green bank loans, attractive EV prices, green insurance plans, and green registration of cars. The UAE government has been working on a plan, which will expedite a 15% reduction of carbon emissions by 2020. This plan also includes 10% and 20% targets for EV adoption within the government’s own fleet.
IS THERE A DEMAND FOR ELECTRIC CARS IN AFRICA?
In 2014, Tesla for the first time announced that they would be launching an electric car in South Africa. South Africa has the Nissan LEAF and BMW i3, however, statistics demonstrate that electric car sales in South Africa are inadequate. Only 160 electric cars were sold in 2015, compared to the 291,332 in the United States and 24,500 in the United Kingdom. In other parts of Africa, the market penetration of electric cars is less. Local electric vehicle companies, like Uganda’s Kiira Motors, are limited in number, but they strongly anticipate that the demand for electric cars in Africa is likely to increase.
Although electric cars are comparatively rare across the continent, there is a support for increased vehicle production. Advanced research in the optimization of electric powertrain technology is still on-going at several international locations. With the invention of cheaper and optimized systems and development of relevant infrastructure, electric cars shall present clean, silent, and eco-friendly transport solutions in Africa.
CHALLENGES FOR THE ELECTRIC VEHICLES MARKET IN AFRICA
In South Africa, the new Tesla will be sold for a steep ZAR 530,000 at current exchange rates. The vital support infrastructure for these vehicles, such as charging infrastructure, has still not been developed in the region. According to the Open Charge Map, an online database of global charging equipment locations, South Africa is the only country in which contributors have identified electric vehicle charging stations. Despite this shortcoming, the demand for clean and silent transport technologies like electric vehicles is expected to increase consequent to the development of such vital infrastructure in the region.
One of the main challenges for the electric vehicle market is load shedding. For instance, in South Africa, there is not enough electricity available to meet the demand from consumers. The African government believes that Africa’s electricity issue will be overcome shortly. For instance, the Ugandan government stated that Uganda’s power generation had increased to 830 megawatts from 596 megawatts in 2010. The government is also expected to increase its renewable energy investment as a remedy for phasing out power shortages in Uganda.
Additionally, the demand for the electric car is expected to increase across Africa in the coming years. According to BMW research, there is a potential in other parts of the country, such as sub-Saharan Africa for electric cars as well. In March 2015, BMW introduced its i-brand electric vehicles and plug-in hybrid electric vehicle (PHEV). Since 2015, the company has delivered a total of 419 BMW I units to its customers in South Africa i.e., 203 units of i3 EV, while the BMW i8 ranks first among PHEVs, with 216 units have been sold.
UAE’S REGULATIONS FOR ELECTRIC VEHICLES TO BE EXTENDED ACROSS GCC
GCC countries are set to implement the UAE’s draft regulations for the use of electric vehicles, as the region gears up for the increase in the demand for eco-friendly vehicles. The main purpose of adopting these directives is to guard the environment against emissions and pollution, support the national economy, boost new sources of economic growth, and realize the country’s strategy that aims to support eco-friendly concepts and innovation.
The UAE System for Electric Vehicles, the first of its kind, regionally, was launched in the first quarter of 2017. The set up aims to ensure safety and efficiency of the vehicles. It will also have the minimum standard for the efficient power consumption for electric vehicles strategically to protect the environment and natural resources of the country. The UAE government will issue certificates of conformity to all the electric vehicles that match the requirements of the new system. The latest system is expected to contribute to raising the air quality level by 90% by 2021.
About the market
The Middle East & Africa automotive high-performance electric vehicle (EV) market is expected to register a moderate CAGR during the forecast period, 2018 – 2023.
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