Stellantis has suspended plans to build its first manufacturing plant in South Africa as low-cost Chinese automakers reshape the country's automotive market and intensify competitive pressure across the continent.
Speaking in Johannesburg on June 30, Mike Whitfield, Managing Director of Stellantis South Africa, broke nearly three years of silence on the project by announcing that the company had placed its planned factory in Gqeberha, Eastern Cape, on hold. Whitfield said Stellantis would clarify the project's next steps in the coming months, according to comments reported by Reuters.
Stellantis announced the greenfield project in 2023. The company planned to build the facility on a new site and initially produce Peugeot Landtrek pickup trucks. The automaker had originally expected to begin operations last year.
"We certainly have not abandoned this project. We have simply put it on pause," Whitfield said. Stellantis is now redesigning the project to allow the plant to manufacture several vehicle models, although the company has not identified those models. Whitfield made the announcement during the presentation of Stellantis' Middle East and Africa (MEA) strategy, which forms part of the group's 60 billion euro ($68.7 billion) global investment plan unveiled in May 2026.
China Advances While Stellantis Reassesses
Stellantis has revised its strategy because South Africa's
automotive market has changed rapidly since 2023. Consumers have increasingly shifted toward vehicles priced below 400,000 rand ($24,654). Chinese automakers have responded quickly to that demand.
Whitfield said that 94% of pickup trucks sold in Africa were manufactured on the continent three and a half years ago. He added that the figure has since fallen to about 70%. Asked whether Stellantis would consider partnering with Chinese manufacturers at the South African facility, Whitfield dismissed the possibility. "Our focus remains very much on ourselves," he said.
However, Stellantis plans to increase vehicle imports from Asia, including China. Samir Cherfan, the group's Chief Operating Officer for the Middle East and Africa, said Stellantis would source sport utility vehicles and pickup trucks from Asia at the most competitive benchmark costs to preserve its competitiveness. He added that the company's plants in Morocco and Turkey rank among the most competitive manufacturing sites within the MEA region.
South Africa's automotive market continues to expand despite intensifying competition. Total vehicle sales reached 596,818 units in 2025, an increase of 15.7%, according to the National Association of Automobile Manufacturers of South Africa (NAAMSA). However, vehicle imports continue to grow faster than domestic production.
Chinese automakers have also begun investing in local manufacturing capacity. Jetour plans to begin assembling sport utility vehicles at Rosslyn, near Pretoria, in 2027. For Stellantis, every month that the project remains on hold creates additional opportunities for competitors to strengthen their position in South Africa's automotive market.
