Deputy President Paul Mashatile said the adoption of a new trade proposal to the US could relieve tariff-related pressures on the automotive manufacturing sector.
Mashatile was addressing journalists and delegates on the final day of the 2025 National Association of Automotive Component and Allied Manufacturers (Naacam) Show in Gqeberha this week.
"[The proposal] aims not just to settle the 30% tariff but also has ramifications for more than 130 other trading partners who may reroute products into the South African market,” he said.
“The imposed tariffs threaten to disrupt well-established trade flows and weaken the global competitiveness of South Africa’s automotive manufacturing ecosystem,” the minister noted, adding that ongoing engagement with the US would yield practical solutions.
“I must highlight that there will be repercussions felt throughout the entire value chain if we do not reach an amicable trade agreement with the White House.”
Mashatile encouraged collaboration under the 2018 African Continental Free Trade Area (AfCFTA), whose mandates include reducing trade barriers, fostering regional value chains and harmonising regulations.
“Creating a single continental market for goods and services could potentially lead to increased trade, investment and job creation in Africa.”
The deputy president acknowledged the need to protect the automotive sector, which employs about 115,000 people, of whom 80,000 work in the component sector.
“We must never allow the loss of these gains because of external and internal pressures.”
He cited Naacam's recording of 12 company closures as worrying, reported to have affected 4,000 individuals.
“What is of more concern are the recently released figures by Stats SA showing that the country’s unemployment rate has climbed to 33.2% in the second quarter of 2025, from 32.9% in the previous quarter.”
Amid local and global challenges, Mashatile praised recent component sector investments in the Eastern Cape, namely by Shatterprufe, a part of PG Group and Ebor Automotive Systems, producer of plastic injection-moulded components and assemblies, with facilities in Nelson Mandela Bay and East London.
Eastern Cape premier Oscar Mabuyane addressed attendees before the deputy president, commending transformation in the sector in light of August being Women's Month. He acknowledged the success stories of Martina Biene, head of VW Africa Group, Jonia Mkonto, senior manager in marketing planning at Toyota South Africa Motors, Nthabiseng Motsepe, head of communications for Stellantis, Shivani Singh, commercial director of Naacam, and Maja Smith, senior manager at Ford.
Mabuyane acknowledged concerns that parastatals such as Transnet and Eskom needed to do more to support manufacturing, logistics and exports.
“We want to make a special appeal to delegates at this show not to despair considering the challenges faced by the automotive sector.”
He said that the government had made impactful interventions at Eskom. “Between April 2024 and March 2025, electricity was available 96% of the time, up from just 9.9% the previous year.”
A planned rollout of projects in the province to the tune of R2.5bn between 2025 and 2030 aims to ensure energy security for industries and households.
“We are working with Transnet to ensure that investments are made in their infrastructure in the province to enable economic growth.”
He said the berth capacity of the automotive terminal in the Port of East London had been increased to allow for new-generation vessels to berth in the port.
Separately, a new project named Ukuvuselela entails a high-capacity rail corridor for automotive volumes from Gauteng to the Eastern Cape. The projected completion date is 2028 and it should allow for a transfer capacity of 150,000 units a year.
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