Stock Declines Amid Tariff Announcements
Daimler Truck Holding AG and Volkswagen AG’s Traton SE saw their stock prices fall in early trading as European truck manufacturers grappled with President Donald Trump’s recent tariff announcements.
US Tariff Details
Trump revealed plans to impose a 25% tariff on imported heavy trucks starting Wednesday in a post on Truth Social, though he did not provide additional details. In Frankfurt, Daimler Truck’s shares dropped by as much as 4.9%, while Traton’s stock decreased by 3.1%. Both companies have assembly plants in Mexico that could be impacted by these tariffs.
Volvo’s Gain Amid Uncertainty
In contrast, shares of Sweden’s Volvo AB, which manufactures Volvo and Mack trucks domestically, rose by as much as 3.45% in Stockholm. Analysts from Bernstein, led by Harry Martin, suggest that Volvo is in a stronger position than its competitors due to its lower reliance on Mexican manufacturing.
Impact of Trade Hurdles
Trump’s recent decisions contribute to the ongoing trade challenges facing the transportation industry, which includes a 15% tariff on cars imported from the EU, affecting firms like Porsche AG and Volkswagen’s Audi. In recent years, truck manufacturers have heavily invested in new technologies, including batteries and hydrogen fuel cells.
Daimler’s Market Presence
The US is the largest market for Daimler Truck, accounting for roughly 40% of its global sales through brands such as Western Star, Thomas Built Buses, and Freightliner, the latter of which leads the heavy-duty truck segment. Daimler Truck has manufacturing facilities in North Carolina and Oregon but also imports vehicles from Mexico, making it vulnerable to potential disruptions caused by tariffs. The company stated that it is closely monitoring the situation but is not ready to release more detailed comments.
Traton’s Challenges
Traton has already experienced declines in deliveries and orders due to tariff uncertainty in the US, even prior to Trump’s announcement. In July, the company highlighted weak demand in North America and cut a shift at its International Motors plant in Mexico. Traton did not comment on the tariffs.
Volvo’s Local Production Insights
Volvo noted that the local content of its US trucks ranges from 60% to 70%, although it still needs to import certain components not produced domestically. The company emphasized the need for more clarity, stating, “What we have to go on at this stage is merely a Truth Social post. We should wait to see the actual legislative proposal before we can fully assess its potential effects.”
