Trump’s tariffs an unmanageable risk for SA carmakers

MSN - 07:41
For decades, South Africa has benefited enormously from German luxury car brands’ assembly plants. BMW’s Rosslyn and Mercedes-Benz’s East London facilities produce high-margin luxury cars for American buyers. It’s been a terrific business – until now.From the early 2000s, an American preference for BMW 3 Series and Mercedes-Benz C-Class sedans drove enormous profits for BMW and Mercedes-Benz’s South African operations. It was an excellent...

For decades, South Africa has benefited enormously from German luxury car brands’ assembly plants. BMW’s Rosslyn and Mercedes-Benz’s East London facilities produce high-margin luxury cars for American buyers. It’s been a terrific business – until now.

From the early 2000s, an American preference for BMW 3 Series and Mercedes-Benz C-Class sedans drove enormous profits for BMW and Mercedes-Benz’s South African operations. It was an excellent example of the benefits of globalisation: South African build costs and American retail price profits.

BMW and Mercedes-Benz also applied German labour environment standards, which meant working in the Rosslyn and East London facilities provided access to notable benefits and upskilling opportunities.

Americans don’t buy hatchbacks but retain a liking for luxury sedans. That’s crucial for the SA-built W206-series C-Class.

America is a high-value market

There’s a lot of noise and panic in ...
[Short citation of 8% of the original article]