The European car manufacturers, including Mercedes-Benz, Stellantis and Volkswagen, said on Wednesday that the chaos and further upheaval caused by the rates introduced by President Trump had left them fighting to evaluate the impact and unable to plan the future.
After years of slow demand and high inflation, the European car manufacturers went in 2025 with a series of new battery models and large hopes that would have attracted customers.
Instead, they face the global uncertainty that surrounds the supply chains and customers' demand, started by Mr. Trump to impose rates of 25 % on all cars, steel and aluminum that arrive in the United States.
Wednesday, Mercedes-Benz suspended his financial forecasts for 2025, as well as Stellantide, which includes Fiat, Peugeot and Opel between its brands in Europe and Chrysler, Dodge and Jeep in the United States.
“The current volatility regarding tariff policies, mitigation measures and potential direct and indirect effects in particular on the behavior and demand of customers is too high to reliably evaluate business development for the rest of the year,” said Mercedes-Benz in a note Wednesday.
Stellantis has mentioned “the evolution of customs rates, as well as the difficulty in providing for their potential impacts on the market and on the competitive panorama”, for its decision.
Volkswagen Group, the largest car manufacturer in Europe, has decided not to eliminate its prospects for 2025, but instead has reduced its profit expectations to the bottom of its forecasts, between 5 and 6 percent. The company, which owns Audi, Porsche and the Volkswagen brand, warned that the initial calculations had been made before the rates were introduced in early April.
All three companies have factories in the United States. Tuesday Trump has announced changes to the rates in what has called “a small flexibility” towards the car manufacturers that produce cars in the United States and are worried about the damage that the taxes on imports will do to their business.
Based on the latest version, the car manufacturers who pay a 25 % rate on cars imports are not subject to other withdrawals, such as in steel and aluminum, or on some imports from Canada and Mexico. However, the rules do not seem to protect the car manufacturers from rates on steel and aluminum that their suppliers pay and can transmit.
The main group that represents the German car manufacturers welcomed the move of Mr. Trump, but called it “a small step” which only slightly relieved the burden caused by the rates.
The German car manufacturers operating in the United States were seized by taxes on imports on parts and vehicles that came from Canada and Mexico, where many established operations after Trump reworked the free trade agreement with those countries during his first term in office.
“Companies urgently need more clarity in order to evaluate the exact impact and implement measures with legal certainty,” said Hildegard Müller, president of the German association of the automotive industry.
Porsche was among the German brands most affected by rates. It is based on the US market for 40 percent of its sales, but produces its sports cars exclusively in Germany, leaving it strongly exposed to duties.
The sad performance of the sports car manufacturer in the first three months of the year dragged his parent company, Volkswagen Group, which declared on Wednesday that his earnings decreased by over 40 percent in the first quarter.
Even before Mr. Trump introduced the rates, the main Volkswagen brands were struggling against high costs and surcharge in his plants in Germany, as well as greater pressure from Chinese competitors who are flooding the European market despite an increase in taxes on imports approved by the European Union last year.
Volkswagen produces cars, including electric ID.4, in a Chattanooga factory, in Tennessee, and is building a factory in the South Carolina to produce off -road vehicles under the Scout brand. Audi produces cars in Europe and Mexico but not in the United States. Oliver Blume, CEO of Volkswagen, said that the company is taking into consideration the possibility of moving the production of another of its models in Chattanooga to avoid rates.
The German media reported that Mr. Blume and his counterparts to Mercedes-Benz and BMW met Mr. Trump in an attempt to elaborate an agreement. German car manufacturers and their suppliers employ around 138,000 people in the United States, according to the commercial group of the German sector.
The rates are making other European car manufacturers rethink their strategy in the United States. The British car manufacturer Aston Martin said on Wednesday that he was holding imports into the United States due to rates. Instead, the company plans to use the inventory that has already been sent, said its CEO in a note. Jaguar Land Rover has also said that he is making a break to the United States.