By Nqobile Dludla
GQEBERHA (Reuters) -South African auto parts manufacturer Jendamark Automation stands to lose 750 million ($43 million) rand of contracts in a U.S. market it has built up to account for 50% of its exports, its operations director told Reuters.
The 40-year-old company based in coastal city Gqeberha builds automated assembly lines for catalytic converters, engines and axles for automotive customers such as BMW and Mercedes-Benz among others.
But like global automakers and suppliers far and wide, they have been hit hard by U.S. tariffs.
“As it stands now, we’ve got about 750 million rand of deals with our American customers that (we’re) at risk of losing,” Siegfried Lokotsch said.
“I don’t know if they’re going to still buy the lines from us. We thought we were going to get the orders, we were in a good position … In my mind, they’re gone (the contracts) because they’ve (the tariffs) just gone up.”
About 85% of Jendamark’s business in South Africa is for export, with 50% of that to the U.S., where it also has an office.
Jendamark is looking for new contracts in other markets, such as Saudi Arabia, but the company has its work cut out to replace the U.S. business it expects to lose.
“To find a new market and to understand how they operate in the country and where the opportunities are is not something that just happens overnight,” he said.
($1 = 17.5018 rand)
(Reporting by Nqobile DludlaEditing by David Goodman)
