South Africa was reportedly one of Tesla’s top target markets for a 2026 rollout, but that plan now appears to have lost momentum. According to MyBroadband, sources close to the company said Tesla had been preparing for a local launch before political strain between South Africa and the United States complicated matters.

Tesla’s South Africa Plan Goes Back Years

Tesla’s local ambitions are not new. In March 2016, the company began accepting pre-order deposits from South Africans for the Model 3. Early deliveries were initially expected in 2018 after Tesla opened a small office in Cape Town, but those vehicles never arrived. In 2019, Elon Musk also said a Tesla store would “probably” open in South Africa before year-end, but that did not materialise either.

Import Duties Remain a Major Hurdle

A major obstacle is South Africa’s tax structure on imported vehicles. MyBroadband reported that cars imported from outside the European Union and United Kingdom face a 25% import duty. For electric vehicles, that 25% tariff applies regardless of origin. Imported cars are also hit by an ad valorem luxury tax, which rises sharply as vehicle prices increase. Because EVs usually cost more than comparable petrol cars, that extra tax makes them even less affordable for local buyers.

Local EV Market Still too Small

Tesla has also been watching the size of South Africa’s EV market. A source previously told MyBroadband the company considers overall market demand before entering a country. At the time, South Africa was still selling fewer than 1,000 EVs a month, below the level needed to justify a rollout. MyBroadband said Naamsa data showed 1,088 EVs were sold by reporting manufacturers in 2025, down 13% from 2024. However, those figures do not include BYD, whose local sales numbers are not publicly shared with Naamsa.

Diplomacy May Have Changed the Game

The report said worsening diplomatic tensions between Pretoria and Washington may have further disrupted Tesla’s plans. MyBroadband’s source claimed the fallout after Donald Trump’s re-election threw “a spanner in the works”. The article also noted Musk has repeatedly criticised South African policies, especially black economic empowerment rules, which he says have blocked Starlink’s local licensing push. Tesla did not respond to MyBroadband’s request for comment before publication.