Shares in European carmakers and automotive suppliers fell sharply on Tuesday after new U.S. tariffs of 25% took effect on imports from Canada and Mexico, a key automotive manufacturing hub for global firms.<\/p>\n\n\n\n
The STOXX Europe 600 Automobiles and Parts Index (.SXAP) experienced its largest drop since September 2022, falling 5% in afternoon trading. Companies such as Volkswagen (VOWG_p.DE), Stellantis (STLAM.MI), and BMW (BMWG.DE) were among the hardest hit, as all have significant manufacturing sites in Mexico.<\/p>\n\n\n\n
According to Mexico’s automotive industry association, Stellantis and Volkswagen Group\u2014including Audi\u2014are the largest European exporters of light vehicles from Mexico to North America.<\/p>\n\n\n\n
Stifel Research estimates that the tariffs will impact approximately \u20ac8 billion ($8.4 billion) of Volkswagen\u2019s revenue in 2025, doubling to \u20ac16 billion for Stellantis. If the companies absorb the full cost of the tariffs, Volkswagen could lose around 12% of its operating profit, while Stellantis could suffer a staggering 40% decline.<\/p>\n\n\n\n
Following the news, Stellantis shares dropped to their lowest level since July 2022.<\/p>\n\n\n\n
Analysts at Citi described the tariffs as a \u201crelevant negative for the auto sector that should increase volatility across all auto stocks \u2026 due to a material impact on both production costs and selling prices.\u201d<\/p>\n\n\n\n
German automotive supplier Continental (CONG.DE) also saw a sharp decline, with shares dropping nearly 10% in afternoon trading. The company, which issued a bleak outlook for 2025, stated that it would analyze the impact of the tariffs on its manufacturing sites in Mexico and Canada before making strategic decisions.<\/p>\n\n\n\n
The tariffs pose a significant challenge for Germany\u2019s export-driven automakers, which have expanded production in Mexico over the years, drawing criticism from European policymakers.<\/p>\n\n\n\n
Germany\u2019s Economy Minister Robert Habeck vowed that Europe would respond firmly to any trade restrictions. \u201cThe EU will not be pushed around,\u201d Habeck said. \u201cIf President Trump imposes the announced tariffs on EU products, we will react with unity and self-confidence.\u201d<\/p>\n\n\n\n
Mercedes-Benz (MBGn.DE) echoed similar concerns in an emailed statement, warning that protectionist measures often lead to retaliatory actions that hurt all parties involved. \u201cThis cannot be in the interests of politics and business,\u201d the company stated.<\/p>\n\n\n\n
The U.S. tariffs on Mexico have added significant pressure on European automakers, further straining transatlantic trade relations. As European policymakers prepare their response, automakers must navigate rising costs, potential countermeasures, and increasing market volatility.<\/p>\n\n\n\n
<\/p>\n","protected":false},"excerpt":{"rendered":"
Shares in European carmakers and automotive suppliers fell sharply on Tuesday after new U.S. tariffs of 25% took effect on imports from Canada and Mexico, a key automotive manufacturing hub for global firms. Major Declines in European Auto Stocks The STOXX Europe 600 Automobiles and Parts Index (.SXAP) experienced its largest drop since September 2022,<\/p>\n","protected":false},"author":5,"featured_media":6287,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[3592,3593,3590,3589,3595,3591,2909,1859,3085,3594],"class_list":{"0":"post-6286","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-automotive-exports","9":"tag-bmw","10":"tag-continental-ag","11":"tag-european-carmakers","12":"tag-germany-economy","13":"tag-mexico-auto-manufacturing","14":"tag-stellantis","15":"tag-trade-tensions","16":"tag-u-s-tariffs","17":"tag-volkswagen"},"_links":{"self":[{"href":"https:\/\/guardianglobe.org\/index.php?rest_route=\/wp\/v2\/posts\/6286"}],"collection":[{"href":"https:\/\/guardianglobe.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/guardianglobe.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/guardianglobe.org\/index.php?rest_route=\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/guardianglobe.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6286"}],"version-history":[{"count":1,"href":"https:\/\/guardianglobe.org\/index.php?rest_route=\/wp\/v2\/posts\/6286\/revisions"}],"predecessor-version":[{"id":6288,"href":"https:\/\/guardianglobe.org\/index.php?rest_route=\/wp\/v2\/posts\/6286\/revisions\/6288"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/guardianglobe.org\/index.php?rest_route=\/wp\/v2\/media\/6287"}],"wp:attachment":[{"href":"https:\/\/guardianglobe.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6286"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/guardianglobe.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6286"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/guardianglobe.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6286"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}