Automobile giant slashes 500 jobs in South Africa as UK tax policy hits sales

The company stated that the move is part of a “realignment” of production capacity in response to subdued global sales.

“We regret that these essential plant adjustments will result in a reduction of positions across both facilities.

“We understand the impact this has on our valued employees, and we are committed to supporting those affected. As part of this process, we will be offering voluntary separation options,” Ford said in a statement.

“We see this announcement as possibly the beginning of greater job losses facing the entire automotive industry in South Africa,” warned Willie Venter, deputy general secretary of Solidarity.

He argued that international uncertainty, economic pressures, and unfavourable local policies are eroding the industry’s competitiveness.

The union said it would engage Ford through consultation processes to interrogate what it described as a “drastic reduction” in vehicle sales.

Ford executives have attributed the slump to two key factors: weaker-than-expected demand for the plug-in hybrid Ranger, and changes in UK tax policy.

From April 2025, double-cab pickups with a payload of one tonne or more have been reclassified for tax purposes as passenger cars, rather than commercial vans, which significantly increases ownership costs.

“In the UK, this tax change has unfortunately reduced volumes. It’s had a big impact in terms of our European orders,” explained Neale Hill, President of Ford Motor Company Africa.

He added that the company’s plug-in hybrid Ranger has underperformed in international markets.

“We haven’t seen the plug-in hybrid Ranger hit the volumes that we’ve been looking for. It’s an expensive vehicle, plus we are not getting to the European originating content, which then makes it able to go into Europe duty-free.”

Despite difficulties abroad, Hill noted that South African demand for the Ranger remains stable and even shows “slight growth.” However, production has been scaled back, with operations reduced from three shifts to two.

Ford’s Silverton plant has the capacity to produce 200,000 vehicles annually, but utilisation is expected to fall well below that level.

“Currently, this year will be about 100,000, and the installed capacity at capable volume is 140,000. That’s what we’ll keep going forward,” Hill confirmed.

The retrenchments add to growing concerns about job security in South Africa’s manufacturing sector, where the automotive industry remains a cornerstone employer and a significant exporter.