Global auto stocks fell on Monday as the world reacted to President Donald Trump’s tariff barrage.
Share prices of Japanese and European automakers dipped after he announced tariffs on Canada, China, and Mexico.
The levies could cost carmakers importing from those countries an extra $33 billion, per Nomura estimates.
Auto stocks tumbled on Monday as President Donald Trump’s tariff barrage unsettled global markets.
Toyota and Nissan both closed about 5% lower and Honda stock fell 7.2% after Trump announced 25% tariffs on goods from Canada and Mexico and a 10% levy on Chinese imports on Saturday.
All three countries vowed to respond, sparking fears of a global trade war and sending the dollar surging on Monday.
The tariffs pose a major risk for the global automotive industry, with Japan’s carmakers especially exposed to the Trump administration’s tariffs on Mexico.
Toyota, Nissan, and Mazda all have factories south of the border making vehicles for the US market, with Toyota moving production of its Tacoma pick-up truck to Mexico in 2020.
The new tariffs could cost automakers importing vehicles and parts from the three countries an extra $33 billion a year, according to calculations from Nomura.
Tesla fell 5% in morning trading in New York, while General Motors was almost 2% lower and Ford dipped 0.8%.
European carmakers Volkswagen, Stellantis, and BMW were also hit by market turmoil. VW fell as much as 6.7%, bringing its decline over the past 12 months to more than 22%.
Stellantis, which owns Jeep, Chrysler, and Ram, tumbled as much as 7%. It is also highly exposed to tariffs on Mexico, where about a third of its full-size pickup truck production is based.
Europe has avoided being hit with import levies, but Trump hinted over the weekend that could soon change.
He told BBC News that the European Union would face tariffs on goods imported to the US «pretty soon.»
The onslaught of tariffs is likely to have a dire impact on the automotive industry, both globally and in the US.
Jeffries analysts estimated that the tariffs imposed by Trump would add $2,700 to average US vehicle prices, with the Detroit «big three» of Ford, General Motors, and Stellantis likely to be the worst affected due to their sizable presence in Mexico.
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