South Africa's tire manufacturing industry is facing increasing pressure from imported products, even as local producers retain significant installed capacity, continue to invest in plants and seek a larger role in the country's automotive value chain.
This was the message from Nduduzo Chala, executive manager of the South African Tire Manufacturers Conference (SATMC), in an interview with CNBC Africa, where he described the sector as effectively “stuck in the mud” despite its strategic role in manufacturing and employment.
SATMC represents South Africa's three remaining tire manufacturers: Bridgestone South Africa, Continental Tire South Africa and Dunlop Tires South Africa. The industry has already suffered a notable blow with the closure of Goodyear's local production facility in August last year, reducing the number of domestic manufacturers from four to three.
Chala said the local tire sector was previously a stable and growing market, supported by substantial investment from manufacturers. According to him, the industry has attracted capital investment of about Rs 3.6 billion in the last three years and installed production capacity of about 6.1 million tires in local factories. The sector accounts for approximately 10% of employment in South Africa's broader automotive sector.
Still that base is not being fully utilized. Chala said local factories are currently operating at only 76% capacity, a figure he directly linked to rising import penetration, especially from Asia.
The challenge, he said, is ongoing in both major sales channels for tire manufacturers: original equipment supplies to automakers and the replacement market, where consumers buy new tires after existing tires wear out. While South Africa's vehicle park remains relatively stable at around 13 million registered vehicles, the composition of cars on the road is changing, with Chinese brands gaining share and already entering the market with imported tyres.
At the same time, local manufacturers are losing ground in the replacement market, which Challa described as the largest and most important channel for the domestic industry. In 2016, SATMC members supplied approximately 60% of tires sold in the aftermarket, meaning six out of every 10 replacement tires were produced locally. That ratio has since reversed. Chala said local producers now account for only 40% of replacement tire sales, while imports account for 60%.
He argued that that fluctuation weakened the business case for domestic production.
A central complaint of the industry is that imported tires are coming into South Africa at prices that local producers cannot match. Chala said local manufacturers believe this reflects dumping and unfair trade practices, with some foreign competitors benefiting from state subsidies that distort pricing.
He said the industry had previously filed a successful application to address dumping, in which Chinese imports were identified as the source of injury. However, after those corrective measures were introduced, producers saw what Challa described as rigging of duties, as production and exports shifted to other Asian markets, including Vietnam, Cambodia and Thailand.
In fact, he said, similar products continued to enter South Africa through different routes, putting pressure on domestic manufacturers.
Challa was careful to say that the industry is not opposed to imports in principle. Rather, he said the issue is fairness, sustainability and ensuring that local production is not hollowed out by low-priced imports and illegal or counterfeit products.
He warned that one manufacturer's losses should be seen as evidence of structural stress in the market. A 20 percentage point loss in market share in the replacement segment, he said, raises serious questions over the long-term feasibility of maintaining production facilities in South Africa unless policy support is strengthened.
This has intensified the industry's focus on the review of the Automotive Production and Development Programme, or APDP2, which is the incentive framework that underpins South Africa's automotive industrial policy.
Chala said SATMC is pushing for a strong localization agenda during the review process, including mandatory localization commitments from original equipment manufacturers. In practical terms, this would mean a defined share of components used in vehicle production being produced locally, in line with the objectives of South Africa's Automotive Master Plan, which targets 60% localisation.
He also argued that incentives should be better aligned with the replacement market, not just vehicle assembly. Since the aftermarket constitutes a large part of tire demand, Chala said the policy mechanism should help push locally produced tires in that segment. Doing so will improve capacity utilization and support the sustainability of the three remaining producers, he said.
On the government's response, Chala said in a measured tone, the industry has received support from the Department of Trade, Industry and Competition and Minister Parks Tau. He pointed to a recent two-day workshop involving stakeholders from across the automotive value chain as the beginning of the formal APDP review process.
According to Challa, early signals from the government have been positive, particularly with regard to support for deeper localization and renewed investment in component manufacturing, including tyres. Nevertheless, he stressed that the review process now needs to be finalized in a way that leads to concrete outcomes for domestic manufacturers.
Beyond trade measures and localisation, Challa also highlighted broader concerns about illegal imports and counterfeit goods, issues that have plagued many sectors of the South African economy. Although he did not quantify the scale of those losses, he said the widespread pattern of import penetration underscores the need for stronger enforcement and a more coherent industrial strategy.
At the same time, he said the industry still sees areas of opportunity. One of the most promising is the rise of new energy vehicles, or NEVs. Chala said South Africa cannot remain isolated from global automotive changes and must embrace changes in technology and production if it wants to remain competitive.
He argued that NEVs present a meaningful opportunity not only for South Africa's domestic market, but also for export to the rest of the continent, especially as African economies are modernizing their vehicle fleets. Chala said one of the continent's persistent problems has been its role as a dumping ground for second-hand vehicles, and he suggested that the adoption of new technologies could help create a stronger manufacturing and distribution platform centered on South Africa.
However, for now, the immediate priority for tire manufacturers is clear: protecting local production, preventing market share losses and securing policy changes that make it viable to maintain manufacturing in South Africa.
Without strong localization commitments and a strong response to unfair trade, the industry warns that much capacity could remain idle – and the country's manufacturing base could further decline.