Published on August 8, 2020 |
by Remeredzai Joseph Kuhudzai
August 8, 2020 by Remeredzai Joseph Kuhudzai
When it comes to the auto industry, the interaction between Japan and many African countries is best described as a form of entanglement. Although they are separated by a great distance, it is difficult to describe the state of many African countries apart from Japan. Japanese brands rule Africa and Toyota is king.
Nissan and Mazda vehicles are also very popular in Africa. Hundreds of thousands of used Japanese vehicles are imported into Africa every year. It’s because only a few African countries have banned the import of used vehicles. These are Egypt, Morocco, South Africa and Sudan. The rest have age restrictions on the maximum age of a vehicle that can be imported. These age limits range from 5 years to 10 years.
Some countries apply penalty charges for vehicles over 10 years old. A few others have no age limit at all. Used vehicles can then land at more affordable prices for the vast majority of low- and middle-income consumers, resulting in growth in used vehicle imports in some markets at rates above 10% per year. year.
All of these imports are traditionally ICE vehicles. Recently, there has been an increase in the number of mild and complete hybrids imported to Africa by used car dealers due to the growing inventory of used hybrids in Japan.
Honda and Toyota are promoting hybrids over the years. It is quite common to see models such as Honda Fit & Insight hybrids as well as Toyota Crown and Prius hybrids in many African cities. Toyota has even gone into overdrive by marketing its mild hybrids around the world as “self-charging”. After several years of service in Japan, these hybrids that have no outlet are now finding a second home in Africa.
What the world really needs is a lot more full battery electric vehicles replacing gasoline and diesel vehicles. The fastest way for Africa to join the revolution would be to use the used vehicle ecosystem established and centered around Japan for countries that drive on the left side of the road, which are the majority of countries. East and Southern Africa. For West African countries, they buy most of their used vehicles from the United States and Europe, and even then, Japanese brands still feature high on the import list in Africa. from West.
A potential bottleneck could arise very soon in the supply side of used electric vehicles. Thanks to the love of Japanese OEMs for mild hybrids and their quest to extend the era of ICEs for as long as possible, sales of electric vehicles in Japan have been very disappointing. Sales have been so low that the electric vehicle market share in Japan was recently just under 1%.
Used electric vehicles are starting to appear in several African countries and you guessed it, they are mostly old Japanese vehicles. These vehicles are primarily used Nissan Leafs, and we have covered a number of these developments with used Nissan Leafs in the stories below:
- It happens! African car dealers start stocking more used electric vehicles
- Zimbabwean family shows even with 6-hour daily grid outages most people could comfortably live with an electric vehicle
- Drivelectric Kenya shows why you should drive an electric vehicle in Kenya!
- VAYA Africa launches VAYA Electric and positions itself for growth in Africa
- All Nopia electric taxi service seeks to expand in Kenya
As you can see, the Nissan Leaf was highlighted as it is the only model readily available for Japan. This is a huge problem! The Nissan Leaf has sold just over 480,000 units since 2010, just behind the electromobility icon, the Tesla Model 3, which has sold over 500,000 units. Most importers are targeting the very first models from 2011 through 2014, which land in the respective countries at prices between $ 9,000 and $ 16,000 depending on age, mileage and battery condition.
Several countries, such as Kenya, Zimbabwe and Ghana import around 100,000 used ICE vehicles per year. Consumers are starting to notice more and more electric vehicles on the road and at used car dealerships. More consumers will start to participate in the action. Let’s just say that in a few years, used electric vehicles start to account for around 30% of vehicle imports. For 500,000 imports from Japan, 150,000 of them would be leaves, and we would soon start to run out of leaves to import since leaf sales in 2020 were so low in Japan. All of this would mean that we would run out of used Nissan Leafs very soon for the following reasons (ignoring scrapped / damaged vehicles):
- The 480,000 Leafs sold so far have not been sold in Japan, significantly reducing the potential vehicle supply.
- Cupcake competition from countries like New Zealand which also allow second-hand imports from Japan
- Not all Leaf owners in Japan would be selling their Leafs soon.
The UK is perhaps an alternative market where imports could increase. UK electric vehicle market is on fire right now. Used electric vehicles from the UK are generally more expensive for the same make, model and year of manufacture. Therefore, most used car dealers prefer to import from Japan.
Another option could be to work with the plethora of Chinese new energy vehicle manufacturers to replace traditional used vehicle imports with new, cheap Chinese models. It would require a bit of marketing, however, as African consumers like their Japanese brands a little too much. We recently looked at how electric driving is cheaper than driving ICE vehicles in Africa in Part 1, Part 2, and part 3. Africa’s low motorization levels offer a unique opportunity to jump into the world of electromobility.
Featured Image: Nissan Leafs at the launch of NopeaRide’s Thika Road Mall Charging Station, Thika Road, Nairobi. Photos of Remeredzai Kuhudzai
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