Mercedes, Stellantis Scrap Guidance Amid Tariff Chaos

President Donald Trump’s tariffs prompted several of Europe’s largest automakers to withdraw financial guidance, underlining the extent of the chaos unleashed by his fast-changing trade tactics.

Jeep owner Stellantis NV and Germany’s Mercedes-Benz Group AG on Wednesday pulled their forecasts for this year citing the duties, which are upending supply chains and driving up car prices. Volkswagen AG left its outlook largely unchanged but warned it isn’t yet factoring in the impact of the levies.

The volatility sparked by the duties “is too high to reliably assess” how business will develop this year, Mercedes said. The luxury-car maker warned that operating earnings, cash flow and margins would be hit if the current trade hurdles persist.

Bloomberg's Craig Trudell reports.

Carmakers have struggled to tally the impact of the tariffs as the Trump administration continues to change its position, following up initial threats of tough levies with caveats, exemptions and delays.

The president signed directives on Tuesday to lift some duties on foreign parts and prevent multiple levies from stacking on top of each other. While the moves are expected to ease some of the burden on manufacturers and their suppliers, major questions — including whether the US will reach a trade deal with China — remain unanswered.

“Companies urgently need more clarity,” said Hildegard Müller, who heads Germany’s VDA auto lobby. Trump’s latest orders fall “far short of what is needed and only reduce the imposed tariffs very slightly.”

Aston Martin Lagonda Global Holdings Plc on Wednesday said it’s limiting shipments of its luxury cars to the US and using up existing stock on dealer lots there to soften the tariff blow. The company doesn’t make any vehicles in the US and already said it plans to raise prices on some cars there.

Mercedes’ stock declined in Frankfurt trading, while shares of Volkswagen and Aston Martin recovered earlier losses. Stellantis rose 1.4% as of 1:47 p.m. in Milan as analysts flagged stabilization in its North American business and stronger pricing across key regions. The company makes most of the cars it sells in the US locally, meaning it should benefit from Trump’s latest reprieve.

The president has argued the levies are necessary to boost domestic car production and employment. Auto-industry executives have warned imposing steep tariffs over the long term would work against that goal. General Motors Co. scrapped its guidance on Tuesday and is putting $4 billion in share buybacks on hold until it has more clarity on the duties.

Trump’s latest tariff changes are a “good sign,” Stellantis CFO Doug Ostermann said during an earnings call, adding that the automaker is talking to suppliers about ways to use more US-made parts in its cars. Stellantis may need to recalibrate its investments in the region depending on how duties develop, he said.

Volkswagen is ready to work with US policymakers on its production expansion plan and ways to mitigate the levies, Chief Financial Officer Arno Antlitz said Wednesday. Europe’s largest automaker already manufactures some cars for the US market in Chattanooga, Tennessee. Less than a third of the cars the group sold in the US in 2024 were manufactured there, with the remainder imported from Mexico and Europe.

Mercedes, which operates a factory in Tuscaloosa, Alabama, earlier this month said it’s considering shifting another vehicle model to the US to counter the duties. The manufacturer currently ships Europe-made vehicles to North America while also producing cars in the US that are sold locally and exported to markets including China.

Mercedes CFO Harald Wilhelm said tariffs would cut the company’s automaking margin by 300 basis points this year if left unchanged, even when taking Trump’s partial relief into account. That would reduce a previously guided range of 6% to 8% to as low as 3%.

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