The duties on the car sector will have Deep repercussions On a sector that was already very vulnerable, due to a structural crisis and hasty and too ambitious choices of the EU in terms of ecological transition, not supported by an incentive staff plan capable of evolving the supply chain. But what will happen now? And who will pay more the duties imposed by Trump? Scope ratingwhich already has a negative evaluation of the European automotive sector, highlights the problems and the main victims in Europe.
The European car industry – explains Lucas Pozzi, Scope Raws analyst- is vulnerable The imposition of US duties on imports, since producers export in the enormous American market from their factories located in Europe, Mexico and Canada.
The data arrive at the worst moment
The European market – explains the analyst – is currently facing some structural challenges linked to the transition to electric vehicles (lack of government subsidies, higher prices, insufficient charging infrastructures), competition by the Chinese brands And to the weak question of consumers in Europe and China. In this context, the imposition of rates of 25% will further deteriorate operational performance, causing interruptions of the supply chain in Europe.
Stellantis and Porsche the most vulnerable
For Scope Rings, The heaviest impact It will probably be on companies that depend most on exports from Europe to the US market, such as Stellantis, the Volkswagen-Porsche and BMW coupled coup.
Stellantis mainly produces/assembles its cars in Mexico (Peugeot, Citroen, Opel …) e Canada (Jeep, Chrysler, Ram), with a small production capacity in the United States. By operating in a very competitive market with low -cost cars it could be easily supplanted by other local brands It is more competitive, as rates would not apply, and lose even more market shares in the United States. There market share went from 9.4% in 2023 to 7.8% in 2024 in the USA, which represents its major CN market a contribution of 42% on turnover 2024.
Porsche produces almost all its cars in Germany And he exports them to the United States, where he has no production capacity. Since it is a small business but with high margins For the controlling Volkswagen, the duties risk reducing the margins of Porsche and Arterro Group, transferring the tariff increases to the prices with relative Customer loss in favor of rival brands.
Is transferring the factories to the USA a solution?
Some producers are already already moving production To avoid duties or re -evaluating their supply chains. The cars will certainly be more expensive since the producers will try to transfer the highest costs to consumers, but for some of them the margins will be reduced, since they will not be able to move them completely. Others, mainly luxury brands, seem less exposed since their customers are not so sensitive to price increases.
If in the short term the impact of the duties will be a cold shower, considering a longer time span, there is the possibility of compensating the die dice effect. US protectionism – explains Pozzi – will encourage some companies a better diversify their wallet at the cost of a greater exposure to emerging markets more volatile. For companies that are decided to move production, duties represent a incentive to invest in the United Statesas Stellantis is thinking, reducing logistical costs, supply the local market faster and improve the positioning of the brand, perhaps even receiving incentives from the local government.
