The European automotive industry is bracing for turbulence as former US President Donald Trump proposes steep tariffs on imported vehicles. Luxury brands such as Mercedes-Benz, Porsche, and Aston Martin could face severe financial repercussions if the measures take effect.
Impact on Major Carmakers
Analysts warn that Trump's proposed 100% tariffs on European cars would drastically increase prices for American consumers, potentially slashing sales for high-end manufacturers. Mercedes-Benz, Porsche, and Aston Martin, which rely heavily on the US market, are particularly vulnerable.
Market Reactions
Shares in affected automakers dipped following the announcement, reflecting investor concerns over shrinking profit margins. Meanwhile, Toyota, which has a stronger US manufacturing base, appears less exposed to the tariff threat.
Eurozone GDP Concerns
The potential trade war comes at a delicate time for the Eurozone, where economic growth remains sluggish. A decline in automotive exports could further strain the region's GDP, raising fears of a prolonged downturn.
Industry Response
German and British car lobby groups have condemned the proposal, calling it a "blow to free trade." Some executives are reportedly exploring contingency plans, including shifting production to the US to circumvent tariffs.
As tensions escalate, the automotive sector faces an uncertain future, with policymakers on both sides of the Atlantic scrambling to mitigate the fallout.
