Chinese and Indian Vehicle Imports Threaten South Africa’s Auto Industry, Warns CMH
South African automotive companies are facing severe pressure due to the rapid influx of Chinese and Indian vehicle imports, according to Combined Motor Holdings (CMH). The company has warned that without increased government intervention, this trend could lead to significant job losses.
Economic Challenges Impacting Local Manufacturers
In its 2025 Integrated Annual Report, CMH CEO Jebb McIntosh highlighted the tough economic conditions affecting the sector. “Challenges ranged from the zero-growth economy and continued high interest rates to the prolific increases in basic household utilities, such as electricity and water,” he stated.
These factors have drastically reduced disposable income, making vehicles less affordable for consumers and weakening demand for big-ticket purchases.
Declining Profits Amid Import Competition
Despite a 3.2% revenue increase in its 2025 financial year, CMH reported an 18.13% decline in operating profit, falling from R781.16 million to R639.54 million. McIntosh attributed this drop to pricing pressures caused by low-cost foreign imports, which have eroded sales of locally manufactured brands.
“The unrestricted proliferation of Chinese and Indian vehicle imports is placing extreme pressure on local producers,” he said, emphasizing the need for government support to prevent job losses.
Market Contraction and Brand Struggles
National passenger and light commercial vehicle sales dipped slightly from 496,000 to 494,000 units in the past year. The luxury vehicle segment has been particularly hard-hit, with sales declining by 10% in 2023 and another 8% in 2024.
Several brands represented by CMH have had to restructure:
- Ford has shifted focus to light commercial vehicles.
- Nissan discontinued affordable pickup models due to pricing pressures.
- Volvo reduced its dealer network from 25 to 7, focusing on metropolitan areas.
Electric Vehicle Market Faces Hurdles
McIntosh noted that electric and hybrid vehicles remain unaffordable for most South Africans without government subsidies. “Nothing more has been heard of incentive proposals promised last October,” he said, highlighting Volvo’s struggles in this niche market.
The CEO warned that unless local manufacturers receive stronger support, the industry could face further declines, risking thousands of jobs.
This article was first published by Daily Investor and is reproduced with permission.