Share prices of automakers slid Thursday after US President Donald Trump announced painful tariffs on imported vehicles and parts as he presses hardball trade policies many fear will spark a recession.
In Tokyo, Toyota — the world’s top-selling carmaker — fell two percent, Honda shed 2.5 percent while Nissan was off 1.7 percent, while Mazda dived six percent.
Seoul-listed Hyundai gave up more than four percent.
Among European auto firms, Peugeot and Jeep maker Stellantis shed 3.5 percent, Porsche four percent, and BMW 1.8 percent.
In Mumbai, India’s Tata Motors, which exports Jaguar Land Rovers to the United States, lost more than five percent.
US-listed car giants also tumbled with General Motors and Ford all deep in the red in after-hours trade.
“Recent glee over the notion that Trump wouldn’t impose sector-specific tariffs… (in early April) has been entirely undermined by the fact that the president has instead opted to start announcing such measures ahead of that date,” noted Joshua Mahony, analyst at Scope Markets.
There had been indications also that levies lined up for the president’s “Liberation Day” on April 2 would be less severe than feared.
However, the White House’s habit of alternating between tough talk and leniency has fanned uncertainty, and the latest announcement did little to soothe nerves.
“What we’re going to be doing is a 25 percent tariff on all cars that are not made in the United States,” Trump said as he signed an order in the Oval Office.
The move takes effect at 12:01 am Eastern time (0401 GMT) on April 3 and affects foreign-made cars and light trucks. Key automobile parts will also be hit within the month.
About half of the cars sold in the United States are made within the country. Of the imported vehicles, about half come from Mexico and Canada, with Japan, South Korea, and Germany also major suppliers.
Japan’s government called the tariffs “extremely regrettable”, while Canadian Prime Minister Mark Carney called them a “direct attack” on his country’s workers.
And French Finance Minister Eric Lombard warned on Thursday: “The only solution for the European Union will be to raise tariffs on American products in response.”
UK finance minister Rachel Reeves said Britain does not want to “escalate” trade wars, with London locked in talks with Washington over potentially securing a post-Brexit trade deal.
“We are looking to secure a better trading relationship with the United States,” she told Sky News.
Losses on London’s FTSE 100 index were offset by strong gains among clothes retailers, with Next jumping 6.9 percent after posting annual pre-tax profit above the symbolic £1 billion ($1.3 billion) level.
Close rival Marks and Spencer won 3.4 percent.
– Key figures around 1030 GMT –
London – FTSE 100: DOWN 0.6 percent at 8,641.37 points
Paris – CAC 40: DOWN 0.4 percent at 8,002.76
Frankfurt – DAX: DOWN 0.7 at 22,672.94
Tokyo – Nikkei 225: DOWN 0.6 percent at 37,799.97 (close)
Hong Kong – Hang Seng Index: UP 0.4 percent at 23,578.80 (close)
Shanghai – Composite: UP 0.2 percent at 3,373.75 (close)
New York – Dow: DOWN 0.3 percent at 42,454.79 (close)
Euro/dollar: UP at $1.0774 from $1.0757 on Wednesday
Pound/dollar: UP at $1.2918 from $1.2891
Dollar/yen: UP at 150.95 yen from 150.54 yen
Euro/pound: DOWN at 83.39 pence from 83.41 pence
West Texas Intermediate: DOWN 0.1 percent at $69.57 per barrel
Brent North Sea Crude: DOWN 0.1 percent at $72.97 per barrel