US automakers like GM, Ford, and Stellantis face potential hit from proposed Trump tariffs

From Investing.com: 2024-11-26 21:51:27

U.S. automakers like GM, Ford, and Stellantis could face a blow from Trump’s proposed 25% import tax on Mexico and Canada. GM, which exports the most vehicles from Mexico, may be hit hardest. GM is expected to import over 750,000 vehicles from Canada or Mexico this year, including popular models like the Chevy Silverado and GMC Sierra pickups. GM, Stellantis, and Ford have yet to comment on the proposed tariffs. The impact of these tariffs would be felt across North America, affecting the profitability of automakers and potentially leading to job cuts.

Trump’s tariffs are seen as a response to issues like immigration and drug trafficking rather than an economic strategy. The threat of tariffs on Mexico and Canada may be a negotiating tactic. Mexican President Claudia Sheinbaum criticized the proposed tariffs, warning of inflation and job losses. The tariffs could also impact Chinese automakers who use Mexico to bypass U.S. tariffs on Chinese EVs, though other trade barriers already block these imports. Shares of GM, Stellantis, and Ford dropped after the tariff announcement.

The 25% tariff could disrupt Mexico’s auto industry, which heavily relies on exports to the U.S. Consumers in the U.S. could also feel the impact, as higher tariffs lead to increased prices for vehicles. Pickup trucks popular in rural areas, like the Toyota Tacoma and GM’s Chevrolet Silverado, are among the vehicles made in Mexico. Manufacturers may struggle to absorb the additional costs, potentially leading to higher prices or reduced profitability for all vehicles sold in the U.S.



Read more at Investing.com: Analysis-GM and other US automakers would take big hit from Trump tariffs By Reuters