South African Company Faces Major Job Losses and Exits Overseas Due to US Tariffs

Strategic Insights -

A Nelson Mandela Bay engineering company, ROVD, has suspended a major factory build and implemented a four-day work week, anticipating significant job losses and potential offshore manufacturing due to 30% export tariffs imposed by US President Donald Trump. The company, which has been a stalwart of the automotive manufacturing industry for 61 years, has lost hundreds of millions of rands in contracts and seen cancellations from US customers. ROVD's CEO, Garth de Villiers, stated that the company was "being penalised for trying to compete" and was now considering offshore manufacturing to remain globally competitive.

Key Takeaways:

  • ROVD Engineering, a 61-year-old Nelson Mandela Bay company, suspended a major factory build and implemented a four-day work week due to US tariffs.
  • The company has lost hundreds of millions of rands in contracts and seen cancellations from US customers, resulting in significant job losses.
  • ROVD's CEO, Garth de Villiers, stated that the company was considering offshore manufacturing to remain globally competitive.
  • The company's people and culture manager, Athi Lupondwana, emphasized the importance of government support and engagement in this crisis.
  • Women, Sports and Community Development Minister, Masixole Zibeko, cited the impact of US tariffs on the automotive industry, stating that it is "likely to be the most adversely affected in the country".
  • ROVD had secured land to build its new premises and started architectural work to triple its production capacity before the tariff announcement.
  • The company hit the headlines in 2023 after building a digitally controlled salt harvester for a mine in Botswana, the first machine of its kind in Africa.
  • ROVD counts some of the most well-known names in cars globally as clients, including Mercedes-Benz, Volkswagen, Nissan, BMW, Ford, and Toyota.