SA vehicle production factory export 6.5% of South Africa's vehicle exports are to the United States.
Image: Supplied
The 'Liberation Day' trade measures, announced by US President Donald Trump on April 2, could have serious implications for the South African automotive industry, says Naamsa | The Automotive Business Council.
The move imposes punitive tariffs on all products imported into the US. These differ between countries, but South Africa has been hit with a 30% import tariff on all products.
Naamsa stated that these recent announcements present another challenge for an industry already grappling with multiple headwinds.
In 2024 the US accounted for 6.5% of South African vehicle exports, making it the third-largest destination for locally produced vehicles, with an annual export value in the region of R35 billion.
However, of South Africa's seven volume vehicle manufacturers, only BMW and Mercedes export to the US. These companies have not disclosed the percentage of vehicles exported to that destination, but it is likely to be significant.
Vehicle manufacturers will not be able to absorb these proposed tariff costs, and as a result imported vehicles in the US will see significant price increases, leading to lower sales of these products.
Naamsa CEO Mikel Mabasa said the US tariffs undermine existing trade agreements and the principles of a fair, rules-based trading system.
"The SA auto industry contributes significantly to economic development, employment, and industrialisation, and these tariffs could undermine our progress,” Mabasa said.
Naamsa has urged the South African government to prioritise trade discussions with the US, to seek clarity on the future of the African Growth and Development Act (AGOA) and to deliver solutions that support job creation and consumer demand.
South Africa's Minister of Trade, Industry and Competition, Park Tau, announced earlier this week that South Africa will "urgently" seek a meeting with US authorities of the tariffs and AGOA.
The Minister argues that South African vehicle exports pose no threat to the US industry, accounting for just under one percent of its automotive imports.
Naamsa is due to attend a Council meeting of the International Organisation of Motor Vehicle Manufacturers (OICA) on April 18, hosted in Washington.
Mabasa said the industry body would use this opportunity to lobby as well as advocate for South Africa's positions.
IOL
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