Published by Global Banking & Finance Review®
Posted on February 3, 2025
3 min readLast updated: January 26, 2026
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Trump's tariffs on Mexico, Canada, and China significantly impact Asia automakers, raising concerns about global economic growth and prompting retaliatory measures.
(Reuters) - Shares of Japanese and South Korean car makers and their suppliers led declines in Asia on Monday, as exporters across the region were walloped by U.S. President Donald Trump's introduction of sweeping tariffs on Mexico, Canada and China.
The move by Trump, though widely expected, knocked some of the world's biggest manufacturers, as investors grappled with the prospect of weakening demand from the world's top economy and, more worryingly, the possibility of a downturn in global growth.
Automakers were among the hardest hit. Many Japanese and South Korean car makers, and their suppliers, have operations in Mexico and have long exported cars made there to the United States.
Toyota, the world's top automaker, and smaller rival Nissan fell more than 5%. Honda tumbled more than 7%.
Nissan has two plants in Mexico, where it makes the Sentra, Versa and Kicks models for the U.S. market. It exports about 300,000 vehicles to the U.S. a year, Chief Executive Makoto Uchida said in November.
Honda sends 80% of its Mexican output to the U.S. market, and its chief operating officer Shinji Aoyama warned in November it would have to think about shifting production if the U.S. were to impose permanent tariffs on imported vehicles.
South Korea's Kia Motors which has a factory in Mexico, fell nearly 7%. South Korean electric vehicle battery firms and battery materials makers, which had plans to build factories in Canada to supply to GM, Ford and other companies slumped. POSCO Future M and EcoPro BM dived 9.1% and 8.7%, respectively.
Trump imposed 25% tariffs on Mexican and most Canadian imports and 10% on goods from China. While mainland China's markets are closed for the Lunar New Year holiday, Chinese stocks listed in Hong Kong slid on Monday, reflecting the concern about the tariffs.
Mexico and Canada have vowed to impose retaliatory tariffs, with Canadian Prime Minister Justin Trudeau announcing 25% tariffs against $155 billion of U.S. goods.
Australia's big iron ore miners, BHP, Rio Tinto and Fortescue were down between 2 and 5 percent on Monday on prospects the tariffs would stunt global growth.
Rio Tinto was seen as most exposed due to its Canadian aluminium business, which analysts estimate sells around 1.35-1.6 million metric tons into the U.S. and which would likely be rerouted to other markets. The tariffs would likely mean a 4% impact to its earnings before interest, taxes, depreciation, and amortization (EBITDA), according to analyst Glyn Lawcock of Barrenjoey.
Shares of Taiwanese tech companies with factories in Mexico fell, with Foxconn down 8%, Quanta down around 10% and Inventec down 8%.
(Reporting by David Dolan in Tokyo, Melanie Burton in Melbourne, Ben Blanchard in Taipei, and Hyun Joo Jin in Seoul; Editing by Shri Navaratnam)
Shares of Japanese and South Korean car makers and their suppliers led declines in Asia, with major manufacturers like Toyota and Honda experiencing significant drops in stock prices.
Toyota, Nissan, and Honda were among the hardest hit, with shares falling more than 5% to 7%. Kia Motors also saw a decline of nearly 7%.
Canada announced 25% tariffs against $155 billion of U.S. goods, while Mexico vowed to impose retaliatory tariffs in response to the U.S. tariffs.
The tariffs are expected to stunt global growth, leading to declines in shares of companies like BHP, Rio Tinto, and Fortescue, which are heavily involved in iron ore mining.
Many automakers, including Nissan and Honda, rely heavily on their Mexican operations for exports to the U.S., raising concerns about potential shifts in production due to tariffs.
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