US import tariffs could soon impact the car rental sector in South Africa.
According to the Daily Maverick , the National Association of Automotive Component and Allied Manufacturers NACAAM has confirmed that South African automotive component manufacturers are being forced to scale down production in light of the 25 tariff on vehicle and vehicle part exports to the US. NACAAM CEO, Renai Moothilal , says this will impact the entire supplier base, not just those exporting.
According to Imraan Moolla , CEO of SANI SIXT Rent a Car, the auto tariff increase will impact the broader mobility and travel ecosystem in South Africa.
While we are not directly involved in the manufacturing sector, the ripple effects of higher tariffs and a slowdown in local component production will inevitably reach the rental industry, largely driven by supply and demand imbalances. We anticipate that vehicle acquisition costs will rise, whether for locally assembled vehicles or imported models. In an industry where fleet procurement is a major operational cost, this could put upward pressure on rental prices over time, said Moolla.
Sandile Ntseoane , GM of the Southern African Vehicle Rental and Leasing Association SAVRALA, agrees that increased costs for vehicle acquisition and vehicle repairs, due to a limited supply of components, could mean higher prices for rentals.