Large parking area filled with cars in South Africa’s urban landscape, highlighting the automotive sector’s struggles and economic impact.
South Africa’s automotive industry is facing tough times, with 12 companies shutting down and over 4,000 jobs lost in just two years. The sector, home to major players like Volkswagen and Toyota, is struggling with weak domestic demand—selling only 515,850 locally made cars last year, less than the country’s target of 784,509. A flood of imports now makes up 64% of vehicle sales, while local manufacturing accounts for just 39%, far below the 60% target. The situation has worsened with new US tariffs, which threaten to further disrupt South Africa’s auto industry. To counter the crisis, the government is pushing for more local production, including electric vehicles, and negotiating trade deals to ease US tariffs. Amid the crisis, global automaker Stellantis and China’s Chery are exploring local production, offering a potential lifeline for Africa’s most industrialized auto hub.
Reuters