European Auto Stocks Sink as U.S. Tariffs on Mexico, Canada Kick In
Shares in European carmakers and automotive suppliers fell sharply on Tuesday, after U.S. tariffs of 25% took effect on imports from Canada as well as Mexico, a major automotive supply and manufacturing hub for global firms. The STOXX Europe 600 Automobiles and Parts index (.SXAP) fell the most since September 2022, reflecting exposure to the tariffs. Companies such as Volkswagen (VOWG_p.DE), Stellantis (STLAM.MI), and BMW (BMWG.DE) all have manufacturing sites in Mexico.
- The sudden increase in tariffs highlights the vulnerability of global supply chains, particularly those that rely on complex networks of suppliers and manufacturers.
- Will this move spark a broader trade war between the EU and the US, with far-reaching consequences for the automotive industry and beyond?