Shares in some of Europe's biggest carmakers plunged on Monday after U.S. President Donald Trump imposed new tariffs of 25% on goods from Mexico and Canada and 10% on imports from China, raising concerns about possible duties on EU imports as well.
Volkswagen (ETR:VOWG_p) and Stellantis (NYSE:STLA), which have major operations in Mexico and are particularly vulnerable to tariffs, both fell about 6%, the biggest decliners among their peers.
Volvo (OTC:VLVLY) Cars, Mercedes Benz (ETR:MBGn), BMW (ETR:BMWG) and Porsche were all down between 3.4% and 5.2% by 0843 GMT.
French auto parts supplier Valeo (EPA:VLOF) slumped 7%.
The European auto and parts index fell 3.4% to its lowest in more than two weeks, leading declines among other sectoral indexes on the broader STOXX 600 Europe, which fell 1.3%.
Analysts and pundits worry that tariffs on Mexico could hurt European automakers and their suppliers more than direct tariffs on EU goods.
"We believe around 8 billion euros ($8.2 billion) of VW's revenue is affected by the tariffs and around 16 billion euros of Stellantis' revenue," analysts at investment bank Stifel wrote in a note.
They estimate the full impact of the tariffs is around 12% of Volkswagen's EBIT in 2025 and 40% of Stellantis'.
Volkswagen said on Sunday it is counting on talks to avoid a trade conflict.
JPMorgan analysts said in a note that they expect automakers to provide commitments to the U.S. government on jobs and vehicle production in the U.S. versus Mexico and Canada this week.
Source: Investing.com
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