EU tariffs on Chinese cars may further stall VW, BMW, Mercedes
October 8, 2024
Functions for the Market
Background
European car brands face a tough road ahead as sales declines may be worsened by the European Union’s economic tussle with China.
VW has already announced plans to shut down two German and at least one Chinese plants as vehicle sales are forecast to decline 12% in 2024. Mercedes-Benz Group AG also issued a profit warning in September.
The auto market’s slowdown is already harming Germany’s manufacturing industry, and Q3 manufacturing confidence fell lower than during the 2020 pandemic and the 2009 global crisis. France and Italy’s confidence leveled off but remained below zero.
The broad declines in sales of ICE (internal combustion engines vehicles in many markets have left VW, Mercedes, and BMW highly reliant on Chinese sales, even as automakers see increased price and EV competition there, too).
PRODUCT MENTIONS
The issue
An EU vote on a tariff proposal came after an investigation into allegedly unfair subsidy practices. BMW CEO Oliver Zipse said the tariffs “lead us down a dead-end street.”
Some 26% of BMW revenues came from China in 2023, and analysts will want to watch for sales changes if China takes retaliatory action to EU tariffs.
Discover more with Bloomberg newsletters
Subscribe now
Tracking
Use Bloomberg’s KPIC to view sales forecasts and performance metrics for these automakers and their peers. Run CMAP to see the locations of manufacturing facilities.
For more information on this or other functionality on the Bloomberg Professional Service, click here to request a demo with a Bloomberg sales representative. Existing clients can press <HELP HELP> on their Bloomberg keyboard.