Tesla finally set to debut its EVs in Africa

From the newsletter

Tesla, the world’s largest EV manufacturer, will officially sell its vehicles in Africa for the first time, after incorporating a local subsidiary in Morocco. Tesla Morocco was established on May 27, 2025. According to the legal filing, Tesla Morocco’s objectives include the import, distribution, sale, maintenance, and repair of EVs and energy storage systems.    

• Tesla has been laying the ground for its Morocco entry for years. It built EV fast chargers there in 2021, ostensibly to gauge EV demand. It has also been selling energy storage systems in South Africa. 

• Tesla’s entry is set to shake up Africa’s nascent EV market, which its main rival, China’s BYD, has been racing to dominate. BYD is already in 16 African countries. Further, the US giant’s EVs are generally costlier, meaning it will likely target the higher end of the market. 

More details

• Tesla Morocco will also deploy EV charging infrastructure throughout the country. Beyond EVs, the company seeks to promote and commercialise solar systems, photovoltaic panels, network services, and other related clean energy solutions. The subsidiary’s activities will also include engineering, training, technical support, and the sale of accessories.

• Tesla has been quietly making moves in Africa, perhaps preparing for its official launch in key markets. According to analysis of LinkedIn data by Mobility Rising, Tesla had 1,298 senior employees in Africa in May 2025, an increase of 64% from May 2024. Most of the workers are in Nigeria (14%), Morocco (14%), Egypt (11%), Kenya, South Africa and Algeria (10% each).

• The company’s entry is a significant development for Africa’s EV industry. It comes at a time when the company’s sales in its key markets especially the US, Europe and China have struggled this year. While Tesla has ignored Africa for years, the company could be changing this stance to grow its sales to offset the diminished sales in other markets.

• While it is set to be the first US EV company to officially launch in Africa, the US’s biggest rival, China, already has many EV companies in Africa, including BYD, Zeekr, Xpeng, Dongfeng, among others. BYD has already launched in Morocco, and competition between the Chinese company and Tesla in the North African country could serve as a prelude to a fierce battle for customers that could unfold across the continent.

• However, Tesla could struggle to compete for the mass market in Africa. This is because Tesla vehicles are generally premium-priced. On the other hand, its chief competitor, BYD, is known for having some of the cheapest EVs in the market. While reports suggest that Tesla could potentially introduce an entry-level compact vehicle priced at $25,000 for emerging markets like Africa, the high upfront cost of EVs remains a significant barrier for the average African consumer, where the used ICE vehicle market dominates.

• Tesla’s main competitors for the high-end market will mainly be German. Africa’s high-end EV market is becoming increasingly competitive but is currently dominated by German brands, mainly Porsche, Mercedes-Benz, BMW and Audi. Volvo has also been making significant inroads, particularly in South Africa, with its EX30 the best-selling EV in the country. 

• At the same time, Tesla could have some advantages over its competitors. Most markets in Africa have frequent power outages and an unreliable grid, posing a significant challenge. Tesla’s integrated battery storage solutions (like Powerwalls or Megapacks) could be incorporated into its charging stations to ensure consistent power supply, especially in areas with unstable grids. They could also be used to store sufficient power generated by solar in off-grid regions. 

Our take

• To truly compete in the mass market and offset struggling sales elsewhere, Tesla will likely need to accelerate the development and launch of a more budget-friendly vehicle. This would allow it to compete more directly with Chinese rivals and capture a larger share of the burgeoning African EV market, currently dominated by more affordable ICE vehicles. 

• Tesla's hiring spree, especially in Nigeria, Egypt, Kenya, South Africa, and Algeria, indicates a methodical long-term strategy for broader continental penetration. There is a possibility of the firm introducing official sales launches in these countries, likely preceded by partnerships and local regulatory engagements.

• Tesla will likely leverage its brand appeal to target affluent consumers in Morocco’s key urban centers like Rabat, Casablanca and Marrakech. Eventually, the company may target major cities across the continent like Cairo, Nairobi, Lagos, and Johannesburg, where EV adoption is already gaining traction.