A normal view of manufacturing traces on the Mercedes-Benz meeting plant on June 4, 2025 in Rastatt, Germany.
Florian Wiegand | Getty Photographs Information | Getty Photographs
U.S. President Donald Trump has hailed the framework commerce settlement with the European Union as the most important commerce deal ever made and one which guarantees to be “nice for vehicles.”
An settlement brokered on Sunday between the U.S. and the EU means the Trump administration will impose a blanket tariff of 15% on most EU items.
It represents a major discount from Trump’s menace to impose expenses of 30% from Aug. 1 and virtually halves the present tariff charge on Europe’s auto sector from 27.5%.
Business teams, whereas welcoming the commerce deal, have expressed deep concern concerning the prices related to the brand new tariff actuality.
Sitting alongside the U.S. president in Scotland on Sunday, European Fee President Ursula von der Leyen described the settlement as a “whole lot” following powerful negotiations.
The German Affiliation of the Automotive Business (VDA) mentioned Monday it’s “essentially optimistic” that the U.S. and EU have managed to safe a deal that averts a transatlantic commerce dispute.
“The decisive issue now will probably be how the settlement is structured in concrete phrases and the way dependable it’s,” VDA President Hildegard Müller mentioned in an announcement.
“Nonetheless, it’s also clear that the US tariff of 15 per cent on automotive merchandise will price German automotive corporations billions yearly and place a burden on them within the midst of their transformation,” Müller mentioned.
Alongside a name to make sure automotive provide chains obtain the required help, the VDA additionally pushed for the EU to make the framework situations internationally aggressive for traders and firms “with a purpose to grow to be extra enticing and related as an funding location once more.”
‘A big burden’
The European Vehicle Producers Affiliation, an trade foyer group, mentioned Monday that the U.S.-EU commerce settlement represents an necessary step towards easing “intense uncertainty,” welcoming the event in precept.
“Nonetheless, the US will retain larger tariffs on vehicles and automotive components, and it will proceed to have a damaging influence not only for trade within the EU but additionally within the US,” ACEA Director-Basic Sigrid de Vries mentioned in an announcement.
ACEA mentioned it will carefully look at the main points of the settlement that also must be clarified.
A automobile on the new Citroen C5 Aircross’ manufacturing line within the Stellantis carmaker plant in Chartres-de-Bretagne, close to Rennes, western France, on July 3, 2025.
Damien Meyer | Afp | Getty Photographs
Rico Luman, senior sector economist for transport and logistics at Dutch financial institution ING, mentioned Monday that the brand new tariff charge of 15% on vehicles exported from the EU to the U.S. is clearly a lot better than 27.5% — nevertheless it nonetheless displays “a major burden” for automakers.
“Margins are below strain in a multi-challenge market and the invoice cannot be totally handed on to prospects with out quantity losses,” Luman instructed CNBC by electronic mail.
Second-quarter earnings season confirmed that carmakers had been already fighting the tariff influence, Luman mentioned, noting there’s extra to come back over the approaching months.
“The weakened greenback additionally makes US automobile imports costlier and complicate issues. That is why international automobile makers are all searching for methods to regulate manufacturing footprints inside present amenities,” he added.
Winners and losers?
The Stoxx Europe autos index led beneficial properties throughout early morning offers, up as a lot as 1.6%, earlier than reversing course to dip into damaging territory.
French automobile components provider Valeo traded 4.4% larger at 11:31 a.m. London time (6:31 a.m. ET), with luxurious Italian carmaker Ferrari up round 1%. Germany’s BMW, Volkswagen and Mercedes-Benz Group, nonetheless, had been all down greater than 1%.
Rella Suskin, fairness analyst at Morningstar, mentioned the U.S.-EU commerce deal is more likely to profit EU automakers which have a better reliance on imports from Europe.
“We estimate that Porsche, Mercedes, BMW, and Volkswagen, in that order, are probably the most important beneficiaries of this commerce deal, with a better share of imports from Europe into the US versus Mexico and/ or Canada,” Suskin mentioned.
“Stellantis imports a single-digit share of its volumes from the EU on the market within the US, and thus shouldn’t see significant upside,” she added.
Milan-listed shares of Jeep maker Stellantis had been final seen 0.3% decrease on Monday.
