BMW shares are in the red Monday, amid investor caution as US President Trump threatened to increase taxes on European cars imported into the US. The President has made numerous trade focussed remarks on Twitter and elsewhere, inflaming concerns over a potential trade war.
By 1350 BST, BMW shares were trading 2.06% lower at €82.24. The stock has been moving generally lower since the new year.
Trump eyes EU auto sector for potential taxes
The EU made it clear late last week, that it was not happy with Trump’s plans to slap large taxes on the imports of steel and aluminium into the US. The plans were the subject of a number of comments from EU leaders.
Speaking at Harvard University, Friday, European Commissioner for Competition Margrethe Vestager, said the EU’s response to US tariffs would be to “defend European industry, and the world trading system.”
Vestager also said Trump’s actions were “one-sided protectionist measures, which hurt, not just jobs, but the whole system of rules that makes our global economy work.”
Responding to the general tone of response across the EU to his plans for tariffs and his lack of fear of a global trade war, Trump said he would simply tax EU car imports.
“If the EU wants to further increase their already massive tariffs and barriers on US companies doing business there, we will simply apply a Tax on their Cars which freely pour into the US. They make it impossible for our cars (and more) to sell there. Big trade imbalance!,” Trump tweeted Saturday.
BMW a big US employer and importer
BMW is among a number of EU-based car makers who also manufactures some vehicles in the US. The German vehicle brand is a major employer in South Carolina, where it has over 9,000 employees. BMW said in its latest results that the US purchased 18% of its BMW branded vehicles in 2017.
In response to Trump’s remarks Saturday, meanwhile, European Commission President, Jean-Claude Juncker said on German television that the EU could put taxes on a number of iconic US imports; Harley-Davidsons, bourbon and Levis jeans.