Tariffs hurt vehicle trade

Thousands of jobs in automotive sector under threat in 'crisis in the making'.

- Ina Opperman

The announcement and anticipation of the US tariffs have already had a devastating impact on trade performance, even before the tariffs were implemented.

Vehicle exports to the US dropped by 73% in the first quarter of the year, followed by a further decline of 80% in April and 85% in May.

Mikel Mabasa, CEO of the Automotive Business Council (Naamsa), said this represents a risk of a direct loss of vehicle and component export volumes and annual export earnings which would be difficult to recover in the short term.

Mabasa said this is not just a trade issue, but a socioeconomic crisis in the making.

This is because the US tariffs directly threaten thousands of jobs in the automotive sector, disrupt hard-won industrial capabilities and risk devastating communities such as East London, where the auto sector forms the economic heartbeat of the town.

"If we cannot retain export markets like the US, we risk turning vibrant industrial hubs into ghost towns," he said.