March 27, (THEWILL) – Auto stocks declined in morning trade on Thursday, with Tata Motors tumbling over 6%, after the U.S. President Donald Trump imposed 25% tariffs on car imports from April.
On Wednesday, Trump imposed 25% tariffs on auto imports from April with another 25% tariffs expected to be applied on imports of major automotive parts, including engines and engine parts, transmissions and powertrain parts, and electrical components by May.
In shock reaction, Stock markets across Asia and Europe skidded into the red on Thursday, as auto manufacturers from Toyota to Hyundai and Mercedes led the plunge.
In the equity market, the 30-share BSE benchmark Sensex traded 427.54 points higher at 77,716.04 despite a weak opening. The NSE Nifty quoted 135.30 points up at 23,622.15, recovering all the opening losses.
Shares of Tata Motors tanked 6.58% to ₹661.35 on the BSE. Ashok Leyland dropped 4.60%, Mahindra & Mahindra dipped 1.70%, Bajaj Auto slipped 1.48% Apollo Tyres skidded 1.41%. The BSE auto index quoted 0.86% lower at 48,286.47.
Among auto components and equipment firms Samvardhana Motherson International slumped 7.59%, Sona BLW Precision Forgings tanked 6.69%, Bharat Forge declined 4.28% and ASK Automotive Ltd went lower by 1.82%.
Meanwhile, major car exporter Germany, has called for a firm response from the EU, while Japan said it “will consider all options.”
But US has justified the tariffs, saying they will help the American car industry grow.
Japan, one of America’s closest economic partners, feels this move is unfair. Government officials, including Chief Cabinet Secretary, Yoshimasa Hayashi, have been trying to negotiate exemptions for Japanese goods, but their requests have been denied.
Prime Minister, Shigeru Ishiba, has said that all possible options are being considered to deal with the issue. The concern is that such high taxes could slow down car sales and impact many Japanese companies that rely on exports.
Cars are a huge part of Japan’s economy with utomobiles making nearly 30% of all exports Japan sends to the US. The car industry is also one of the biggest contributors to Japan’s economic growth, providing jobs to millions of people. The new tariffs will make it harder for Japanese car companies to sell their vehicles in the US. This means they may have to increase prices, which could drive customers away.
Speaking on Thursday, V.K. Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said, “Mr Trump’s latest decision to impose a 25% duty on all car imports to the U.S. will impact Tata Motors which exports a significant chunk of JLR cars to the U.S.”
Felix Ifijeh is a journalist with years of professional reporting experience. Known for his keen news sense, compelling storytelling and commitment to accurate, impactful reporting, he has built a reputation for turning leads into clear, engaging, and well-structured reports that resonate with readers. His work reflects deep newsroom experience and a commitment to accurate, impactful journalism.
