Electric Vehicle Adoption: Implications for Employment in South Africa’s Automotive Component Industry

The transition to electric vehicles (EVs) will require significant changes in the automotive industry, particularly concerning its labour force. This study evaluates the impact of EVs on employment within South Africa’s automotive component manufacturing sector. A system dynamics model was developed to assess the effect of EV market penetration on component manufacturing employment over time. Key drivers of employment in the conventional and the EV component industries were identified and incorporated into the model. The results indicate a negative impact of EV penetration on employment of 18.3% when considering 20.0% EV sales (EV20) in 2040. Scenario analyses highlighted the influence of individual components, battery localisation, and load shedding on labour. Tyre and wheel manufacturing was found to be the most labour impactful component in the conventional industry against electrical engines in the EV counterpart. Localising 25.0% of battery production could increase employment by 6.9% and 2.7% in the EV40 and EV20 Scenarios. Load shedding has a detrimental effect on the country’s economy, assumed to reduce employment by 30.0%. However, strategic industry and policy interventions can mitigate the adverse effects of this transition.