The continent’s automotive crown has officially shifted north, with Morocco shattering records to produce over one million vehicles by early December 2025, a massive 79% leap from the previous year. This historic pivot signals the end of decades of South African dominance, driven by a relentless Moroccan strategy that has effectively doubled its production capacity in just ten years while its southern rival grapples with energy instability and policy delays.
The core of this transformation is the confirmation from industry data that Morocco’s output for 2025 exceeded the symbolic seven-figure mark, driven by aggressive capacity expansions from global giants Renault and Stellantis. In stark contrast, South Africa’s production for the year hovered around 600,000 units, marking only marginal growth despite a recovery in exports. The shift is not merely numerical but structural, with Morocco’s Tangier and Kenitra plants now operating as high-efficiency export hubs that feed the European and American markets, generating over $14 billion in revenue and displacing phosphates as the kingdom’s top export earner.
Central to this surge is a rapid technological evolution, moving beyond simple assembly to becoming a fully integrated EV manufacturing hub. Stellantis, facilitating the way Leapmotor expands into the region, has ramped up its Kenitra facility to churn out 400,000 vehicles annually. This output includes increased volumes of micro-EVs alongside new models like the Dacia Bigster launch which targets larger segments. Simultaneously, the kingdom is nurturing homegrown innovation with Neo Motors, which is set to begin production of its Dial-E electric car in January 2026, and startups like Bako Motors’ solar EVs. Adding to this momentum is the confirmed establishment of a Tesla subsidiary in Casablanca as of May 2025, with widely reported plans for a massive $5 billion gigafactory in Kenitra that aims to produce 400,000 units annually starting in 2027.
The ecosystem powering this growth relies on a strategic division of labour where the government provides stability and infrastructure, while global partners supply technology and capital. The Moroccan state has successfully courted Chinese battery manufacturers like Gotion High-Tech to set up gigafactories, ensuring a local supply of critical EV components that meets strict European ‘rules of origin’ requirements. This stands in sharp contrast to the model in South Africa, where manufacturers have long borne the brunt of infrastructure failures, often having to invest in their own power generation to keep assembly lines running during frequent load-shedding episodes.
This divergence signals a fundamental business shift: Morocco has positioned itself as a “nearshoring” powerhouse for Europe, offering a stable, low-cost, and green-energy-powered alternative to Asian manufacturing. By securing free trade agreements with the US, EU, and China, the kingdom has effectively insulated itself from some of the geopolitical trade wars that threaten other emerging markets. Conversely, South Africa’s industry is playing catch-up, hampered by a lack of urgency in transitioning to new energy vehicles (NEVs). While Morocco is already exporting EVs, South Africa’s key policy response—a 150% tax deduction for NEV investments—is only scheduled to come into effect in March 2026, leaving a critical window where investment decisions may have already bypassed the country.
Globally, this development places Morocco in a league comparable to established European manufacturing hubs, while highlighting the widening gap with its African peers. While Egypt and Nigeria struggle with lower volumes and currency volatility, Morocco’s automotive sector has achieved critical mass. The comparison with South Africa is particularly telling; where the latter’s industry is fighting to maintain its existing footprint amidst logistical nightmares at its ports and rail networks, Morocco is actively capturing new market share with a logistics performance that rivals developed nations, anchored by the world-class Tangier Med port.
South Africa’s execution on its automotive master plan has been sluggish, with the much-needed transition to electric mobility delayed by debate and hesitation. Although the country achieved a commendable 15.7% production increase in 2025, reaching nearly 597,000 units, this recovery is fragile and heavily reliant on traditional internal combustion engine exports which face looming bans in key markets like the UK and EU. The implementation of the 150% investment allowance in 2026 is seen by many analysts as “too little, too late” to claw back the lead, especially as competitors break ground on factories today that will define the market for the next decade.
The track record speaks for itself: Morocco attracted Renault in 2012 and Stellantis in 2019, and has now potentially secured Tesla, building a cumulative momentum that is difficult to replicate. The sector now employs over 220,000 people and boasts a local integration rate of over 60%, meaning the majority of vehicle parts are made domestically. This depth of supply chain makes the industry resilient and highly attractive to new entrants who can plug into an existing network of over 250 suppliers.
As 2026 dawns, the question for African policymakers is no longer who leads the continent’s auto industry, but whether the Moroccan model of export-led, green-industrial policy can be replicated elsewhere. With the gap between the two nations now widening to over 400,000 units annually, South Africa faces an existential choice: accelerate its green transition immediately or risk becoming merely a legacy player in a rapidly electrifying world.
