[ad_1]
South African car exports to the United States have plummeted dramatically, falling over 70% in the first quarter of 2025, and tumbling further to 80% in April and 85% in May, 2025, following the imposition of steep tariffs by US President Donald J. Trump. The automotive industry, which relies heavily on the US market under the African Growth and Opportunity Act (AGOA), now faces a growing crisis. The tariffs—initially a 25% duty on cars and now extended to auto parts—have struck a critical blow to one of South Africa’s key export sectors.
Industry body Naamsa described the situation as a looming socio-economic catastrophe, warning that the fallout could endanger thousands of jobs and devastate industrial towns such as East London, where the automotive sector forms the economic backbone. In 2024 alone, the industry accounted for 64% of South Africa’s AGOA trade, generating over 28 billion rand in revenue. The country had proposed a trade package to the US—including a duty-free quota of 40,000 vehicles per year—but this appears to have been overshadowed by Trump’s broader global tariff strategy.
Naamsa CEO Mikel Mabasa cautioned that the damage may be irreversible in the short term, as global competitors fill the vacuum left by South Africa. Local manufacturers, including Mercedes-Benz, now face the dual burden of absorbing rising export costs while reassessing future production and investment plans. While diversification is essential, Mabasa stressed it cannot be achieved overnight, and urgent policy and diplomatic efforts are needed to prevent widespread industrial decline.
[ad_2]
Source link