Shares of U.S. and European Automakers Fall, as traders react to Trump’s heavy Tariff Promise

Shares of U.S. and European automakers fell on Tuesday as traders reacted to U.S. President-elect Donald Trump’s big tariff promise, news organisations have reported.

Shares in Germany's Volkswagen were down 1.6%, while Stellantis the maker of Chrysler, Dodge and Fiat, among other major brands - was down 4.3%. U.S. automakers General Motors and Ford Motor were down 4.1% and 2.1% respectively. Toyota Motor's U.S.-listed shares were down 1.2%.

Trump has pledged that he would impose heavy tariff on imports from other nations; would be imposing a 25% tariff on all products from Mexico and Canada, and an additional 10% tariff on goods from China. Trump’s campaign promise signals a potential global trade war, fears of which are already showing up in the automobile sector. Automobile sector is an integrated sector and a development in one nation impacts economy in another nation.