Impacted by U.S. tariffs, European car companies' profits may decrease by nearly 5.9 billion euros this year.

Due to new tariffs imposed by U.S. President Trump on cars imported from Mexico and Canada, Stellantis (STLA.US) and Volkswagen AG are highly affected, with these tariffs estimated to potentially reduce the profits of European car manufacturers by 5.88 billion euros (6.2 billion dollars) this year. Bloomberg Senior Industry Analyst Michael Dean wrote in a report on Tuesday that this year, brands such as Jeep, Ram, Chrysler, and Dodge may import approximately 417,000 cars from the two countries recently hit with a 25% tariff by Trump. Assuming no mitigation measures are taken, he estimates that Stellantis' profits will face a risk of 3.44 billion euros and Volkswagen AG's 1.77 billion euros. Dean wrote, "With increasing price discounts, intense competition, and overcapacity in the U.S., the space to pass on this additional cost to buyers is limited. It is unlikely that the full tax will be passed on to buyers, which will lead to price increases of 6,000 to 10,000 dollars."