First, we look at the US administration’s current tariff structure and the implications there-off.

1: Where do we stand with tariffs right now related to our automotive industry?

The US Supreme court ruling comes as a positive for the global economy from a tariff perspective, with the previous excessive tariffs being replaced by a 10% standard tariff, which is still high, but more moderate than the previous rates we saw announced by the US President. We continue to expect them to be inflationary to the US, and to slow down global economic activity, particularly global trade.

2: How measurable are the effects of the current tariff structure, any examples?

The US is one of our major trading partner economies, and with the elevated tariffs, we saw significant cuts in our 2025 real economic growth rates from levels close to 2%, to sub-1%, and the eventual realised 1.1% post some of the exemptions in precious metals. The hardest impact has been on labour absorbing sectors in manufacturing and automotive industries, which has left unemployment stubbornly elevated above 30%.

3: Clearly the tariffs are not cast in iron. What could be expected on the short, medium, and long term?

While we acknowledge the positivity in the court ruling, which we expect a more moderate and limited use of tariffs by the US Presidency going forward, we continue to expect some tension on global trade as the US continues to try close its deficit. We therefore expect tariffs to continue slowing global economic activity and trade, particularly with the US, but more moderately than what we initially saw.

4: Would the mid-term elections in the US play any roll and will the newly appointed US ambassador have an influence on the Trump administration when it comes to tariffs?

US policy has increasingly stemmed directly from the White House, which we expect to continue to be the case. The role of an ambassador is to be a spokesperson and liaison for their domestic country in a foreign country.

5: What would be the effect of our own elections this year to swing the US opinion on tariffs in SA?

From a South African perspective, it is essential that we focus on running free and fair elections in a transparent manner, the outcome of which will be purely democratic, as stipulated in our constitution. Historically, very little attention has been paid by the globe on our local elections.

6: Any other predictions and what to be on the look-out for?

Protectionist policies have been on the rise over the past couple of years, and we expect that trend to continue, and with it elevated geopolitical tensions and market volatility.

The second part of our questions revolve around the current war in the Middle East and the effects there-off for South Africa.

1: Just in short, the effect on our energy supplies. Will we get what we need?

If the shock in global oil prices is a short-lived one, then moderately elevated inflation with no more rate cuts priced in for the year. However, as the tension escalates, second round effects may begin to filter to the broader economy, with stubbornly elevated inflation and the potential of rate hikes over the next 12 months.

2: What would be the ripple effect of the above scenarios on our economy?

Higher inflation and higher interest rates, higher input costs through transport and logistics filtering to cost of production and slowing economic activity with persistently elevated unemployment.

3: How would much more expensive fuel and a possible shortage influence the automotive sector if we look at something like monthly sales?

Higher cost pressures on the production side, and lower sales on the demand side stemming from higher interest rates, lower disposable income and elevated unemployment.

4: Could there be other supply chains interruptions if the war drags on and what would it be?

The largest disruption is on the energy front with 20%-30% of global oil supply transitioning through the Strait of Hormuz and Iran itself contributing 10% to OPEC production and 4% to global oil production; and 40% of global oil production being in the Middle-East region.

5: Not only in SA, but worldwide - could this war boost the sale of electric vehicles (EVs), especially if you look at renewable energy sources to charge the vehicles?

With rising costs and instability of brent crude prices, the case for electric vehicles becomes even stronger, with the trend in electric sales being positive notwithstanding missed targets in recent history. However, it is worth noting that energy prices are overall correlated, but energy cost curves for running electric vehicles are significantly lower.

7: What is the prediction on the war (escalation or de-escalation?) and the repercussions in the short, medium, and long term?

It is in the interest of all parties concerned for the war to de-escalate, however the longer the tension persists, the more likely it becomes drawn out over an extended period of time.