European Carmakers Hit by Market Fears Over China’s Retaliation

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Some of Europe's top carmakers saw significant falls amid rising concerns about potential retaliation from China.
Some of Europe's top carmakers saw significant falls amid rising concerns about potential retaliation from China.

Some of the largest carmakers in Europe experienced further declines on Thursday amid escalating concerns over potential retaliatory measures from China following new tariffs imposed by the European Commission on imported Chinese electric vehicles. These tariffs address what the EU perceives as excessive subsidies from Beijing.

Impact on European Automakers:

By 0847 GMT, Europe’s auto index had fallen 2.2%, reaching its lowest point over four months. Meanwhile, the broader region-wide STOXX 600 index was down 0.6%.

Notably, Volvo Car has significant exposure to the Chinese market and saw its shares drop by 5%. German carmakers such as Porsche AG, Volkswagen, Mercedes, and BMW also faced declines, with their stocks falling between 2% and 4%.

Analyst Insights:

Stifel analyst Daniel Schwarz commented on the potential repercussions: “The risk is that China is now also taking actions that would especially hit the German OEMs who are exporting to China.”

This concern underscores European automakers’ vulnerability to Chinese countermeasures that could disrupt their exports to one of the world’s largest automotive markets.

China’s Response and Concerns:

China has disapproved of the new tariffs through its state news agency, Xinhua. Beijing hopes that the European Union will reconsider the tariffs on Chinese electric vehicles and avoid further protectionist steps.

The Chinese government views these measures as detrimental to fair competition in the auto industry and urges the EU to reverse its course.

James Adam

James Adam, a noted business writer for CEO Times Magazine, specializes in insightful industry analysis and executive profiles. Known for his clear, concise style, James offers readers an expert perspective on global business trends and market dynamics.

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