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Mahindra & Mahindra is considering a CKD assembly plant near Durban to strengthen its presence in South Africa.
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South Africa's auto market is expected to grow 15.7% to 596,818 vehicles in 2025, marking a post-pandemic recovery.
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Increasing competition from Chinese automakers is increasing pressure on international players.
Indian manufacturer Mahindra & Mahindra currently evaluates the establishment of a “Completely dropped” The (CKD) production line is at its own site near the port city of Durban. This strategic change means the company will send complete vehicle kits to South Africa for complete local assembly.
The new manufacturing center represents a significant departure from the model established by the company in 2018. Since that time, the firm has used a “semi-dropped” (SKD) scheme where workers receive large, pre-assembled subs from India.
Bloomberg reported these developments, citing unnamed sources. The Indian giant continues to be in active discussions with the Industrial Development Corporation (IDC) to determine the feasibility of the project. This partnership with the state-owned development finance institution highlights the company's intention to deepen its local footprint.
Mahindra & Mahindra intends to meet the growing demand for affordable vehicles. The mid-range segment in South Africa is currently experiencing a significant boom. While the brand already maintains a strong position in rural areas with its popular “pick up” models, it now looks to become a long-term industrial partner for the South African authorities. The move is in line with the national goals of attracting investment in the dynamic manufacturing sector.
Market data supports this expansion strategy. The South African automotive market is set to reach sales of 596,818 new vehicles in 2025. This performance represents an increase of 15.7% compared to 2024 and exceeds pre-pandemic volumes. Passenger cars led this improvement, as sales rose 20.1% to 422,292 units. Furthermore, the National Association of Automobile Manufacturers of South Africa (NAMSA) predicts a 9% to 11% increase in registrations for 2026. Falling inflation and gradual monetary easing provide the primary catalysts for this optimistic forecast.
a competitive market
The project is part of a broader corporate strategy to counter intense competition from Chinese manufacturers. Chinese companies are currently facing a price war in their domestic market and rising trade barriers in Europe and the United States. As a result, these manufacturers have increased their foray into South Africa.
About fifteen Chinese brands now operate within the country through various assembly or distribution channels. These companies compete directly with established giants like Volkswagen, Toyota and Mercedes-Benz.
Recent industry moves highlight the scale of this competition. Chinese automaker Chery signed a deal in April to acquire the Nissan plant in Rosslyn, near Pretoria. The acquisition gives Chery control over the historic site that produced pickup trucks for nearly sixty years. Cherry South Africa will assume control of the land, buildings and equipment by mid-2026. The company intends to use this industrial capacity to serve the local market and the wider Southern African region.
This article was initially published in French by Espoir Oludo
Adapted into English by Ange JA de Berry Quenam