Fitch Solutions: Africa’s Vehicle Output to Hit 1.5m Units in 2026 as AfCFTA RoO Strengthens Trade Framework
The signing of the African Continental Free Trade Area (AfCFTA) Rules of Origin (RoO) for automotive products in mid-February 2026 is expected to advance intra-African trade and industrialisation, although execution risks remain significant, according to Fitch Solutions.
In a recent analysis, the research firm noted that the agreement provides a “practical framework for tariff preferences to translate into genuine trade flows,” supporting deeper regional integration and improving investment confidence across Africa’s automotive sector.
Fitch Solutions explained that the RoO framework—covering tariff lines under HS 8701 to 8716—introduces a 40% African originating content requirement, while permitting up to 60% non-originating inputs, subject to review after five years. The rules are expected to offer legal certainty for manufacturers and customs authorities, enabling firms to structure supply chains around a unified continental standard rather than fragmented national systems.
Over the medium to long term, this is projected to drive increased intra-African automotive trade, encourage supplier localisation, and strengthen regional manufacturing ecosystems.
However, Fitch cautioned that the benefits are likely to be uneven, with gains initially concentrated in established production hubs such as South Africa and Morocco, which together accounted for over 90% of Africa’s vehicle production in 2025.
“Execution risks remain material,” the firm stated, citing compliance complexities, documentation burdens, and structural constraints such as porous borders, grey-market activity, and low consumer purchasing power as potential impediments to widespread adoption.
In its base case scenario, Fitch Solutions forecasts Africa’s vehicle production to grow by 6.4% in 2026 to reach 1.5 million units, with output projected to rise further to approximately 2.2 million units by 2035.
Vehicle sales across the continent are also expected to increase by 5.0% in 2026 to 2.0 million units, before expanding at an average annual rate of 5.7% to 3.4 million units by 2035.
The firm emphasised that the pace and scale of growth will depend heavily on the effectiveness of AfCFTA implementation, particularly in operational areas such as certification, customs capacity, and documentation processes.
While late entrants face structural challenges—including weak component ecosystems, unreliable logistics, and limited industrial capacity—the RoO framework provides opportunities for countries to integrate into the automotive value chain through components, sub-assemblies, and upstream materials.
Ghana and Zimbabwe, for instance, could benefit through their emerging steel industries, provided they meet automotive-grade standards in quality, traceability, and delivery reliability.
Nonetheless, demand-side constraints—including limited access to vehicle financing, low income levels, and the dominance of used vehicle imports—are expected to continue shaping market outcomes.
Fitch Solutions further warned that organised used-vehicle lobby groups in some markets may resist policy shifts that favour new vehicle sales, potentially slowing the growth of local assembly and formal trade channels despite improved regional trade frameworks.
