DAX Continues to Slide as Trump Tariffs Lead Auto Stocks Lower
Auto tariffs take effect April 3, German car makers are lobbying for a bilateral agreement.
- 25% auto tariffs on US imports take hold
- Auto association (VDA) calls for talks
- VDA sees tariffs as a fatal signal
The DAX traded as low as down -0.80% before recovering most of its losses. Automakers leading the way down om incoming trade tariffs.
DAX Hits 2-Week Low
The DAX traded down to a 2-week low this morning as tariffs on US imports are set to effect. The market had been hoping for some kind of reprieve, a delay in the effective tariff date, or bilateral agreement.
Nothing has materialized so far, and the realization of 25% tariffs on autos for German car makers is taking its toll.
The VDA has stated that the tariffs are a “fatal signal” for free and rules-based trade. The auto lobby has also called for negotiations on a bilateral agreement.
Germany’s finance minister warned tariffs would harm both EU and US economies. Although it’s hard to see the US coming of worse when they are net importers of autos.
DAX Live Chart
Automakers Feeling the Pressure
This morning’s pre-trade market saw Volkswagen shares lose 5.1%, while BMW and Daimler Trucks lost approximately 3.5%.
Autos provider Continental also traded lower, down 2.9%. All of the German automakers have plants in Mexico and Canada.
But these countries have also been hit with auto tariffs, and the only way out for German car makers would be to invest in the US.
Last week South Korean auto maker Hyundai got a waiver on auto tariffs after the company committed to investing the US.
Hyundai has committed to investing $21 billion in the US across EV manufacturing, steel production and technology projects.
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