As the automotive industry starts to experience the negative effects of US import tariffs and a possible additional 10% import tariff on BRICS+ countries in future, Eastern Cape Premier Lubabalo Oscar Mabuyane said that, while a national government delegation works to negotiate trade terms with the US administration, other supportive measures are available for companies in this vital sector.

Mabuyane delivered a keynote address during National Association of Automotive Components and Allied Manufacturers’ (NAACAM’s) 2025 Show in Gqeberha, on August 14.

Automotive assembly systems provider Jendamark has, for example, already lost R750-million worth of contracts owing to the US tariff regime, which threatens the company’s 500 employees and 3 000 workers in its local supply chain along with local factories that rely on its goods.

Additionally, tyre manufacturer Goodyear South Africa has started with a retrenchment and restructuring process that includes the closure of its operations in Kariega, in the Eastern Cape, which may result in the loss of 900 jobs.

The company cites a poor medium-term outlook in South Africa, dumping of cheap imported tyres and, to a smaller extent, the impact of tariffs as reasons for the plant’s closure.

Over the past two years, NAACAM has already recorded 12 company closures that impacted more than 4 000 individuals, which is mainly owing to lower domestic sales of locally made vehicles, an influx of imports, low local content levels and stagnant economic growth.

The Eastern Cape is particularly vulnerable to international and local shocks impacting the automotive industry, given that it hosts three of South Africa’s original-equipment manufacturers (OEMs) and about 120 component manufacturers.

To help mitigate against the immediate risks that automotive manufacturers are facing, Mabuyane said national government had proposed the establishment of an export support desk to serve as a direct point of contact for affected companies and other measures to assist companies to absorb the US import tariff to retain jobs and productive capacity.

He urged companies to leverage the Localisation Support Fund to aid competitiveness of affected companies, as well as the Export and Competitiveness Support Programme for working capital and equipment facilities to address short- to medium-term needs across affected industries.

Mabuyane added that the Department of Employment of Labour also had existing instruments to mitigate potential job losses.

He confirmed that the Competition Commission was expected to publish a draft block exemption for exports, which would allow competitor companies to cooperate to improve economies of scale and export efficiencies.

“These measures are sound and national government has swiftly made them available. Our province intends localising these support measures so that companies have access to these measures.

“We will establish a point of contact at the Automotive Industry Development Centre Eastern Cape branch to assist companies to access the support,” Mabuyane stated.

He concluded that these efforts should create a support structure for companies that weare impacted by the US import tariffs in the short term, while buying the South African negotiating team some time to negotiate a better deal.