Donald Trump’s plan to set 25% tariffs on all cars imported to the United States sent Japanese and European automakers down again on Friday as investors continued to reassess the impact on the sector. The new tariffs, which take effect on April 2nd, will target imported passenger vehicles and light trucks, as well as parts such as engines and transmissions.
Losses among automakers such as Toyota (TM) and Honda (HMC) notched on Thursday were extended on Friday in Asian trade.
Honda shares in Tokyo (JP:7267) fell 2.6% at the close having been down over 4% at one point, while Toyota (JP:7203) fell 2.81% for the session. Mazda (JP:7261), (MAZDF) and Nissan (JP:7201), (NSANF), which has plants in Mexico, also declined.
European automakers followed suit, with BMW (DE:BMW), Mercedes-Benz (MBGAF), (DE:MBG) also extending their declines from Thursday. Volkswagen (VWAGY) also saw its German-listed shares (DE:VOW) slide on Friday morning.
In premarket trading on Wall Street, Chrysler-owner Stellantis (STLA) declined another 1.5% after falling 1.25% on Thursday, closing well off its lows of the day. General Motors (GM) stock was also pointed lower after a loss of more than 7% on Thursday. Ford (F) was indicated flat after a decline of nearly 4% on Thursday.
One of the outliers is Tesla (TSLA), which rallied on Thursday as its domestic U.S. manufacturing footprint means it’s seen as a relative winner from tariffs.
EU and Others Plan Fightback
European Commission President Ursula von der Leyen said the European Union “will continue to seek negotiated solutions, while safeguarding its economic interests.”
France’s finance minister Eric Lombard was more direct, describing the 25% tariffs as “very bad news” and that the only solution was for the EU to raise tariffs in response. German economy minister Robert Habeck called for a “firm response to these tariffs from the EU” and said the bloc should “not back down.” Japan’s prime minister Shigeru Ishiba told parliament that “all options will be on the table” in response to car tariffs.
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