German exposure to US tariffs on European car imports

For Daimler-owned Mercedes-Benz, the United States is the second most important sales market globally, behind China. ― Reuters pic
For Daimler-owned Mercedes-Benz, the United States is the second most important sales market globally, behind . ― Reuters pic

FRANKFURT, Feb 23 ― US President Donald Trump this week warned EU policymakers that the United States would impose tariffs on European car imports if a trade deal could not be reached.

Washington has said a 25 per cent tariff on cars sourced from the European Union could be imposed on national security grounds, a step that European policymakers have called unwarranted.

German carmakers Volkswagen, Daimler and BMW, which have large plants in the United States, could be among the hardest hit.

Export to the United States



The United States bought €27.2 billion (RM110.8 billion) worth of German vehicles and components last year, making it the largest export market for the German , according to statistics released by Berlin’s Federal Statistics office this week.

Together the Germans, including VW, Porsche, Mercedes-Benz BMW and Audi, sold 1.34 million cars and vans in the United States last year, according to German auto industry association VDA.

German companies built 750,000 luxury cars at US plants, of which 44 per cent were sold locally and the rest exported overseas, including 95,000 cars to China.

Around 690,000 German vehicles sold in the United States last year were imported from factories within the European Union, of which 470,000 came from German plants, VDA said.

Daimler

For Daimler-owned Mercedes-Benz, the United States is the second most important sales market globally, behind China. Around 316,000 Mercedes-Benz vehicles were sold in the United States in 2018, or around 14 per cent of the brand’s global sales. Parent company Daimler declined to comment on how many cars were exported from Europe to the United States.

Daimler’s US in Tuscaloosa, Alabama has a production capacity of 300,000 vehicles and employs 3,700 people. It makes the GLE, GLE Coupe and GLS models.

BMW



The Munich-based carmaker which owns the BMW, Mini and Rolls-Royce brands, said it sold 355,000 cars in the United States last year and exported 102,354 cars from its plant in Spartanburg, South Carolina, to Europe. The BMW brand on its own sold 311,014 cars.

Around 70 per cent of the total production in Spartanburg, which builds BMW X3, X4, X5 and X6 vehicles, is exported outside of the United States, including 48,537 cars to China, 29,205 to Germany and 16,864 to the United Kingdom.

Volkswagen

Volkswagen Group, which also owns the Audi, Bentley, Bugatti, Lamborghini and Porsche brands, delivered 638,300 cars in the United States in 2018.

The multi-brand group imported 301,200 VW and Audi cars from Mexico to the US and a further 236,000 cars from Europe.

VW brand sold 354,064 cars in the US last year of which 101,100 were built locally at a VW plant in Chattanooga, Tennessee.

VW’s premium brand Audi sold 223,000 cars in the United States last year, of which 153,000 were imported from Europe and around 70,000 Audi Q5 sports utility vehicles from Mexico.

VW’s other sportscar brand Porsche sold 57,000 cars in the United States. Neither Audi nor Porsche has a factory in the US.



Analysts at Evercore ISI estimate that VW Group faces a 2.549 billion euro impact if the United States goes ahead and imposes a 25 per cent tariff on imports from the EU. Daimler, which owns Mercedes-Benz and Smart, faces a €2 billion tariff hit while BMW, which owns Mini and Rolls-Royce, will take a €1.7 billion blow, Evercore said. ― Reuters

Source: The Malay Mail Online





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