31 Mar 2025, 19:01 GMT+10
BERLIN/DETROIT: Automakers worldwide are bracing for the impact of sweeping new U.S. tariffs that could reshape global vehicle production and pricing.
President Donald Trump's decision to impose a 25 percent tariff on imported cars and parts sent shockwaves through the global automotive industry on Thursday, raising concerns about higher prices, job losses, and declining consumer demand.
European manufacturers immediately urged Washington to return to the negotiating table. "Both sides should therefore promptly find a transatlantic deal that creates growth and prevents a spiral of isolation and trade barriers," BMW said in a statement.
The levies, effective April 3 for vehicles and May 3 for parts, are expected to add thousands of dollars to the cost of an average car in the U.S. Analysts at Barclays called the move "more draconian than most anticipated," warning that "there are no ‘winners' in the absolute."
Germany's BLG Group said it anticipates a 15 percent drop in port traffic due to the changes, while Spain's Faconauto warned of a potential hit to jobs and investment.
Auto suppliers, such as France's Valeo, said they have "no choice" but to raise prices. In India, shares of Tata Motors and Sona Comstar, a supplier to Tesla, fell nearly six percent.
The American Automotive Policy Council said U.S. carmakers support Trump's push to boost domestic production, but added it is "critical" the tariffs avoid raising costs for consumers.
Volkswagen, Mercedes-Benz, and Porsche together lost nearly US$6 billion in market value, while sector-wide stocks across Europe slumped. "Consensus will decline, outlooks will be cut, efficiency will be lowered," said Daniel Schwarz at Stifel Research.
Some automakers, including Volvo, Hyundai, and Audi, have announced plans to shift production to the U.S. But executives are wary of making major investments tied to what they see as potentially temporary policies.
"These policies have already made equity and debt markets extremely nervous," Bernstein Research analysts said. "It is hard to judge the duration of such chainsaw-like policies."
Nearly half of the cars sold in the U.S. last year were imported. Cox Automotive expects the tariffs could disrupt almost one-third of all North American vehicle output by mid-April.
Importers can certify U.S.-made content to avoid the tax, but vehicles assembled with non-U.S. parts will face the full tariff. Trump maintains the tariffs will boost U.S. jobs and production.
Get a daily dose of Professional Autos news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Professional Autos.
More InformationBERLIN/DETROIT: Automakers worldwide are bracing for the impact of sweeping new U.S. tariffs that could reshape global vehicle production...
CHARLOTTE, North Carolina: Dollar Tree is cutting ties with its struggling Family Dollar chain in a US$1 billion deal that marks the...
SHANGHAI, China: As global demand for electric vehicles continues to rise, China's BYD is looking to double its overseas sales to over...
ANDOVER, Massachusetts: As artificial intelligence drives up energy demand across the United States, Schneider Electric is making a...
WASHINGTON, D.C.: U.S. consumer confidence continued to drop in 2025, hitting its lowest level in 12 years as more Americans worry...
WASHINGTON, D.C.: Alphabet's self-driving division Waymo is preparing to expand its driverless ride-hailing footprint to the heart...
(Photo credit: Steven Bisig-Imagn Images) The Athletics formally begin the home portion of their Sacramento era when they host the...
Hyderabad (Telangana) [India], March 31 (ANI): Vanguard, an investment management company, announced on Monday its decision to establish...
Job seekers attend a job fair held in Shanghai, east China, Feb. 14, 2025. (Xinhua/Liu Ying) GUANGZHOU, March 31 (Xinhua) -- As China's...
New Delhi [India], March 31 (ANI): Thermal coal in India is once again relatively cheap, making it an attractive input for electricity...
Ujjain (Madhya Pradesh) [India], March 31 (ANI): A drone light show held at Vikramotsav in Madhya Pradesh's Ujjain district on the...
An aerial drone photo taken on March 21, 2025 shows a welding workshop of Audi FAW NEV Co., Ltd. in Changchun, northeast China's Jilin...