European automakers fall as Trump pledges tariffs
Updates with added context, quotes and updated prices
LONDON, Nov 26 (Reuters) -European automakers shares fell on Tuesday, as traders reacted to President-elect Donald Trump pledging big tariffs on Canada, Mexico and China, news that fueled jitters over a potential global trade war.
A basket of European autos and parts stocks .SXAP was the worst performing sectorin Europe, down 1.7%versus a 0.7% fall for thebroader STOXX 600 .STOXX.
Trump said in a post on Truth Social that on his first day in office he would impose a 25% tariff on all products from Mexico and Canada, and an additional 10% tariff on goods from China.
"Areas like the auto sector, which has highly integrated supply chains across the Mexico-US and Canada-US borders, are very vulnerable," said UBS GWM chief economist Paul Donovan.
Shares in Germany's Volkswagen VOWG_p.DE were down 2.1%, while Stellantis STLAM.MI - the makerof Chrysler, Dodge and Fiat, among other major brands -was the biggest faller, off 4.1%.
Italian broker Intermonte said Stellantis would be "hardest hit" by tariffs on U.S. imports from Mexico as the group imported 358,000 units in 2023.
"We estimate that each extra 1pp on tariff could impact pre-tax profit by ~Eu160mn or 1.4% of 2025 expectations," they said.
About a quarter of Stellantis' North American sales are made in Mexico.
French car parts maker Valeo dropped 2.5%,while German luxury brand BMW .BMWG.DE fell 1.5%. Volvo Car was down over 3% andDaimler Truck DTGGe.DE fell 3.4%.
It is a quick reversal for markets, which had on Monday welcomed the nomination of fund managerScott Bessent as Treasury secretary, a key cabinet position with influence over economic policy and international affairs.
Some investors said Bessent's nomination was a relief, given his career in finance and understanding of markets, with some saying his appointment could have reduced the chance of severe tariffs.
Reporting by Samuel Indyk and Lucy Raitano; Editing by Amanda Cooper
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