With the steep rise in fuel prices since March this year leading to historic record highs following massive increases in October, the government intervention annouched this week, is widely welcomed.
Finance Minister Enoch Godongwana announced the government is implementing a temporary tax cut on the fuel levy starting 4 November 2026, which will shave R1.50 per litre off petrol and R3.00 per litre off diesel. This tax relief is expected to cancel out or heavily reduce further market-driven increases forecasted for next month.
The National Automobile Dealers’ Association (NADA) has welcomed the temporary fuel levy relief announced in the Medium-Term Budget Policy Statement, alongside government’s commitment to fiscal stability, infrastructure investment and stronger municipal accountability.
NADA says these measures must translate into lasting improvements in household affordability and the conditions in which dealerships and other businesses operate.
“Fuel costs affect household budgets, business expenses and the affordability of mobility. The temporary levy reductions will provide some breathing space for motorists and businesses that depend on vehicles for their livelihoods,” says Brandon Cohen (photo), Chairperson of NADA.
Brandon says the intervention recognises the pressure that transport costs place on the wider economy, including commuters who depend on public transport and businesses moving goods and delivering services.
“Affordability extends well beyond the purchase price of a vehicle. Consumers must accommodate finance repayments, fuel, insurance and maintenance alongside other household expenses. Fuel levy relief helps with one component of that cost, but sustained improvements require stronger household incomes, employment growth and lower pressure on everyday expenses.”
The downward revision in the economic growth forecast for 2026, from 1.6% to 1.2%, reinforces the need to accelerate reforms that support investment and employment.
“A sustainable automotive retail market depends on consumers and businesses having the confidence and financial capacity to commit to vehicle purchases. Faster, more inclusive economic growth is essential to broadening participation in the market and supporting the jobs and skills that dealerships provide,” he states.
NADA supports the emphasis on municipal financial management, accountability and infrastructure maintenance. Reliable electricity and water, well-maintained roads and effective local services are fundamental to dealership operations and the communities they serve.
“Dealerships are businesses rooted in their local economies. Service disruptions and deteriorating infrastructure add costs and affect their ability to serve customers. Additional municipal funding and stronger oversight must produce visible improvements, with resources directed towards reliable services and properly maintained infrastructure.”
NADA also welcomes efforts to accelerate infrastructure delivery and attract private investment. Completed projects can support employment and business activity, creating demand for vehicles used in construction, deliveries and other essential services.
“The opportunity lies in converting funding commitments and project pipelines into functioning infrastructure that improves productivity. Implementation, maintenance and accountability will determine whether this investment delivers its intended economic benefits,” Cohen says.
Responsible management of public finances and efforts to reduce waste provide an important foundation for confidence and investment. NADA says the benefits of greater fiscal stability must reach households and businesses through improved services, economic opportunities and job creation.
The association also welcomes efforts to strengthen policing capacity, recognising that crime affects employees, customers and business confidence while adding to dealership operating costs.
“Effective policing and accountability are essential to safer trading conditions and stronger local economies. These measures need to deliver practical improvements for businesses and the communities around them.
“NADA welcomes the immediate relief and the direction of the reforms outlined by the Minister. The longer-term test will be whether they strengthen household purchasing power, improve service delivery and create conditions that allow dealerships to invest, develop skills and sustain employment,” Brandon concludes.
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