By Anita Dangazele
- Mercedes-Benz says poor logistics and weak government policy have forced it to cut back in the Eastern Cape.
- The province has lost over 83,000 jobs so far this year, with more closures in farming, tourism and factories.
Mercedes-Benz South Africa has scaled down its operations in the Eastern Cape, and experts say it’s one of the biggest economic blows to hit the province in years.
The company blames poor logistics and unclear government policies for creating a bad environment for business.
It means fewer workers on the payroll, less personal tax, and less money going into local shops and services.
The province already makes up just 8% of South Africa’s economy, even though more than 13% of the country’s people live there. Nearly half the population lives in poverty, and the Mercedes-Benz cuts are expected to push that number even higher.
The Eastern Cape has lost more than 83,000 jobs in the first three months of 2025. And it’s not just the car industry taking a hit.
The farming sector has cut thousands of jobs since December, blaming drought, poor roads and rising costs.
Tourism still hasn’t recovered from the Covid-19 pandemic, with crime and lack of investment keeping visitors away.
Big companies are pulling out. Goodyear closed its Kariega tyre factory in June. ContiTech shut down its conveyor belt plant earlier this year, cutting 125 jobs. Aspen has warned that 134 jobs are at risk at its eyedrop plant in Gqeberha. Bridgestone left four years ago.
Experts warn the province faces a long economic slump unless government and business start working together to fix supply chains, save jobs and help new industries grow.
Pictured above: Mercedes-Benz has scaled back production in the Eastern Cape.Â
Image source: Supplied