US President Donald Trump's tariff plans would mean higher car prices for US consumers and hit global carmakers, Germany's powerful car industry warned on Tuesday as auto stocks fell on the prospect of higher US import duties.
Hildegard Mueller, president of Germany's VDA auto association, told an annual press conference Trump's threatened tariffs would drive up US inflation.
"Donald Trump promised in his election campaign to reduce inflation," she said.
"In this respect, we are hoping for further discussions on the topic."
Trump, who took office on Monday, did not immediately implement the wide range of tariffs he had promised, but said they were an option and indicated tariffs of 25% on Canada and Mexico could be imposed as early as February 1.
In the past Trump has used the threat of tariffs to push carmakers to move more production to the US.
Global carmakers make cars in Mexico for sale in the US, and the Central American country is an integral part of the supply chain for US auto production.
Major suppliers including Bosch and Continental have been working on ways to move some production and mitigate the impact, but US tariffs on Mexican auto imports would hurt US, European, Japanese and South Korean carmakers and suppliers.
In Asia, the continued threat of US tariffs hit shares of Honda, Mazda, Hyundai and Kia, which all produce vehicles in Mexico.
In Europe, Volkswagen and Stellantis, which would be particularly vulnerable to tariffs on Mexican production, were down 0.8% and 1.3% respectively.
Volkswagen, the world's second-largest carmaker, said it was "concerned about the harmful economic impact that proposed tariffs by the US administration will have on American consumers and the international automotive industry".
The company highlighted planned investments exceeding $10bn (R185,018,874,000) in the US, split between its Chattanooga plant and a joint venture with Rivian.
Carmakers have been negotiating with Trump's team ahead of his inauguration, hoping to prevent the imposition of tariffs.
Stellantis chair John Elkann has spent four days in Washington meeting with Trump and top administration officials, according to a company source.
Elkann, who is steering Chrysler and Jeep parent Stellantis while it seeks a new CEO, was among global executives attending celebrations for Trump's inauguration on Monday.
Volkswagen has also been in close contact with the Trump administration over tariffs, two people familiar with the matter said.
Volkswagen and German rivals Mercedes-Benz and BMW all have plants in Republican states that voted for Trump, and all have emphasised their commitment to US production.
The VDA's Mueller said this "should be taken into account" in any talks on tariffs.
"We have a lot to offer, many jobs in the US, a functioning production network that also creates growth and prosperity in the US," she said.
"If tariffs are imposed, we have to consider how we can respond to them in concrete terms."
German carmakers say Trump tariffs would hurt US consumers, industry
Image: Anna Moneymaker/Getty Images
US President Donald Trump's tariff plans would mean higher car prices for US consumers and hit global carmakers, Germany's powerful car industry warned on Tuesday as auto stocks fell on the prospect of higher US import duties.
Hildegard Mueller, president of Germany's VDA auto association, told an annual press conference Trump's threatened tariffs would drive up US inflation.
"Donald Trump promised in his election campaign to reduce inflation," she said.
"In this respect, we are hoping for further discussions on the topic."
Trump, who took office on Monday, did not immediately implement the wide range of tariffs he had promised, but said they were an option and indicated tariffs of 25% on Canada and Mexico could be imposed as early as February 1.
In the past Trump has used the threat of tariffs to push carmakers to move more production to the US.
Global carmakers make cars in Mexico for sale in the US, and the Central American country is an integral part of the supply chain for US auto production.
Major suppliers including Bosch and Continental have been working on ways to move some production and mitigate the impact, but US tariffs on Mexican auto imports would hurt US, European, Japanese and South Korean carmakers and suppliers.
In Asia, the continued threat of US tariffs hit shares of Honda, Mazda, Hyundai and Kia, which all produce vehicles in Mexico.
In Europe, Volkswagen and Stellantis, which would be particularly vulnerable to tariffs on Mexican production, were down 0.8% and 1.3% respectively.
Volkswagen, the world's second-largest carmaker, said it was "concerned about the harmful economic impact that proposed tariffs by the US administration will have on American consumers and the international automotive industry".
The company highlighted planned investments exceeding $10bn (R185,018,874,000) in the US, split between its Chattanooga plant and a joint venture with Rivian.
Carmakers have been negotiating with Trump's team ahead of his inauguration, hoping to prevent the imposition of tariffs.
Stellantis chair John Elkann has spent four days in Washington meeting with Trump and top administration officials, according to a company source.
Elkann, who is steering Chrysler and Jeep parent Stellantis while it seeks a new CEO, was among global executives attending celebrations for Trump's inauguration on Monday.
Volkswagen has also been in close contact with the Trump administration over tariffs, two people familiar with the matter said.
Volkswagen and German rivals Mercedes-Benz and BMW all have plants in Republican states that voted for Trump, and all have emphasised their commitment to US production.
The VDA's Mueller said this "should be taken into account" in any talks on tariffs.
"We have a lot to offer, many jobs in the US, a functioning production network that also creates growth and prosperity in the US," she said.
"If tariffs are imposed, we have to consider how we can respond to them in concrete terms."
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