By Christian Moess Laursen
Shares in the European car makers slipped on Tuesday after President-elect Donald Trump rattled the market with promises of steep import tariffs on Mexico, Canada and China.
This stoked fears of a global trade-war and that Europe might be next in Trump's crosshairs.
However, a 25% tariff on Mexico will also hurt European car makers as many of them manufacture cars there to be sold on the U.S. market, according to analysts.
Jeep and Chrysler maker Stellantis is the most sensitive in the sector to an import tariff on Mexico, Berenberg analysts wrote in a note earlier this month. Nearly a third of the multinational car maker's U.S. sales come from vehicles produced in Mexico, according to the German bank.
Its shares fell the most in the sector, down 4.2% to 12.28 euros in morning trade in Europe.
Meanwhile, Volkswagen imports around 41% of its U.S. volumes from Mexico, while Mercedes-Benz' share of U.S. sales produced in Mexico is around 11%, according to Berenberg. Shares in the two German auto makers fell 2.1% to 80.70 euros and 1.3% to 52.15 euros, respectively.
Shares in Daimler Truck slid 3.5% to 35.02 euros. Nearly half of the German truck maker's revenue last year came from U.S. sales.
Elsewhere, shares in Porsche and Volkswagen-owned commercial-vehicle maker Traton were down 2.2% at 57.96 euro and 3% at 27.90 euros, respectively. Shares in BMW slipped 1.4% to 68.34 euros. Renault currently doesn't have exposure to the U.S.
Trump said in a post on his Truth Social platform on Monday that on the first day of his presidency he would charge Mexico and Canada a 25% tariff on all products coming into the U.S. and an additional 10% tariff on products from China.
About 16% of vehicles that will be sold in the U.S. this year will have been built in Mexico, according to a forecast from research firm Wards Intelligence.
Write to Christian Moess Laursen at christian.moess@wsj.com
(END) Dow Jones Newswires
November 26, 2024 05:09 ET (10:09 GMT)
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