Trump’s tariffs have started biting African automakers

From the newsletter 

South Africa’s auto exports to the US fell by 73% in the first quarter of 2025 compared to the same period in 2024, according to the industry’s association Naamsa. This worsened in April and May, with declines of 80% and 85%, underlining the impact of the 30% import tariff imposed by US President Donald Trump. South Africa is Africa’s second largest vehicle manufacturer. 

• South Africa exclusively exports BMW X3 plug-in hybrids (PHEVs) to global markets, and now faces steep tariff barriers in the US. The Ford Ranger PHEV, which is also exclusively produced in the country, will face an export hit. 

• Despite being the only African country with a free-trade agreement with the US, Morocco. The continent’s largest auto manufacturer, Morocco was also slapped with a 10% tariff. While the country is yet to release official figures, its auto exports to the US are expected to have a major hit similar to South Africa. 

More details

• In April, President Trump announced reciprocal tariffs on fifty-seven countries worldwide. Twenty of them are African. The higher tariffs on African products range from 11% levied on imports from Cameroon and DR Congo to 50% on goods from Lesotho. Other African countries with the highest additional tariffs are Madagascar (47%), Mauritius (40%), Botswana (37%), Angola (32%), Libya (31%), and Algeria and South Africa (both 30%). 

• The new tariffs are a blow to South Africa’s motor vehicles, which have been enjoying preferential access to the US market under the African Growth and Opportunity Act (AGOA). In 2024, vehicle exports from South Africa to the US were valued at $1.40 billion, its second largest market after Germany ($3.8 billion).  

• According to Naamsa, global automakers with a strong South African presence such as Mercedes-Benz, which exports from South Africa to the US, may be forced to absorb rising costs, scale back production, or reconsider future investments, including in EVs. 

• Other major African motor vehicle manufacturers like Morocco will be negatively hit by Trump’s tariffs. While the majority of Moroccan vehicle exports to the US consist of parts and accessories for motor vehicles, the exports had been on an upward trajectory in recent years.  

• Currently, within Africa’s new energy vehicles manufacturing segment, only PHEVs have mainly been affected by the US tariff. This is because Africa doesn’t yet make electric cars at scale. But this could change soon, with a number of global manufacturers with an existing presence in major automotive hubs such as South Africa, Morocco and Egypt signaling plans to introduce EV manufacturing lines within their existing factories. 

• Electric car sales in Africa more than doubled to reach 11,000 in 2024, but this still represents less than 1% of global sales. The majority of these cars are imported, mainly from China. But African governments are accelerating efforts to assemble EVs locally, paving the way for full-scale manufacturing in future. Should this happen, access to global markets for Africa-made electric cars will be key. 

Our take

• The steep US tariffs make exporting Africa-made PHEVs and future EVs to the US economically unviable in the short term. Automakers in South Africa and Morocco could instead target Europe, the Middle East, or intra-African markets for export growth. 

• Global OEMs like BMW and Ford might scale back or delay expansion of EV lines in South Africa if US market access continues to be compromised. However, if incentives from African governments are strong enough, production could shift focus to African or emerging markets. 

• Trump’s tariffs undermine the benefits of AGOA, putting pressure on African governments and US lobby groups to renegotiate trade terms. With AGOA set to expire in 2025, this could become a flashpoint in US–Africa trade relations, especially for auto and clean-tech sectors.