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Shares in German carmakers fall after Trump tariff hike
Finance

Shares in German carmakers fall after Trump tariff hike

Published by Global Banking & Finance Review

Posted on May 4, 2026

2 min read

· Last updated: May 4, 2026

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Shares in German carmakers fall after Trump tariff hike

Impact of U.S. Tariff Increase on German Automotive Sector

FRANKFURT, May 4 (Reuters) - Shares in German carmakers and auto part suppliers slid on Monday after U.S. President Donald Trump announced an increase in car import tariffs to 25% from 15% previously agreed, dealing a fresh blow to the already beaten sector.

Market Reaction

The pan-European automobiles and parts index was down 0.7% as of 0750 GMT.

Performance of Major German Carmakers

German carmakers Porsche, BMW, Mercedes-Benz, Volkswagen were down 0.8% to 1.5%. Car parts suppliers Schaeffler and Continental were down 1.2% and 4% respectively.

Analyst Insights

Exposure of German Premium Brands

The new tariffs announcement is sure to further weaken position of German premium car manufacturers, said Matthias Schmidt, European autos market analyst at Schmidt Automotive, noting that Audi and Porsche are among most exposed companies due to the absence of local production.

Profitability Outlook

The analyst said he expected "2026 to be another year of profit warnings following this announcement."

Existing Challenges in the Sector

The German automotive sector has already been under strain from softening demand in China, slowing global growth and higher input and labour costs eroding profitability.

(Reporting by Christoph Steitz, Amir Orusov, Editing by Linda Pasquini)

Key Takeaways

  • President Trump announced that tariffs on cars and trucks imported from the EU will rise to 25% from the previously agreed 15%, citing alleged non‑compliance by the EU with their trade deal. (apnews.com)
  • The automotive sector faces renewed uncertainty at a time of heightened geopolitical tensions, including the Iran war, with Germany particularly exposed due to its heavy reliance on U.S. auto export markets. (apnews.com)
  • German auto stocks declined between 0.4% and 2.6% on the day, echoing broader European equity weakness, as markets weighed the new tariff’s implications. (aicoin.com)

References

Frequently Asked Questions

Why did shares in German carmakers fall?
Shares fell after President Trump announced higher US car import tariffs on German vehicles.
Which German carmakers were affected by the tariff hike?
Porsche, BMW, Mercedes-Benz, Volkswagen, Traton, and Daimler Truck all saw their shares drop.
How much did US car import tariffs increase by?
The tariffs increased to 25% from the previously agreed 15%.
What was the range of share price declines for German auto companies?
Shares fell by between 0.4% and 2.6%.
Who reported this market update?
The report was by Christoph Steitz with editing by Linda Pasquini.

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