Porsche, BMW and Mercedes most exposed to higher tariffs on cars imported from Europe

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Morgan Stanley, Javier Martinez Olcoz and Ross MacDonald study the possible scenarios of a tariff increase on imported cars from Europe and possible tax cuts.

European cars have a tariff increase of 2.5% while American cars sold in Europe have a tariff increase of 10%. Tariffs for trucks and vans are 25%.The cars most at risk of a rate increase are SUVs and sedans, but precisely the price elasticity is higher in this premium segment. However, it is clear that a tariff increase will affect investors’ interest in the sector and reduce manufacturers’ volume aspirations. Porsche, BMW and Mercedes are the most exposed.

In the case of a tax cut from 21% to 15-20% the effect on bpa is small (1.5% – 2.5%), the biggest beneficiary is Stellantis followed by BMW and Mercedes. Javier and Ross remain cautious in the sector.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.