Throughout 2024, two of the three U.S. automotive stocks traded lower. Ford Motor (F) and Stellantis (STLA) did not reward investors this year, while General Motors (GM) rose. Looking ahead, European and American automotive firms are bracing for Trump’s tariffs.
European firms like Volvo, Volkswagen (VWAGY), and Mercedes-Benz (MBGAF) traded lower. Not only are they facing competition from Chinese EV suppliers, but tariffs will increase costs for suppliers and consumers.
Canada has much to lose. A 25% duty on its imports would freeze if not slow, cross-border trade. The U.S. reasons that a tariff does not violate the existing USMCA free-trade deal.
The U.S. is demanding that Mexico and Canada prevent migrants from crossing the border.
In Canada, its citizens are already unhappy about the surge in immigration in the last few years since before the pandemic. Pressure to control illegal migration and slowing future immigration will hurt Canada’s economy.
Telecoms previously relied on immigrants to boost mobile subscription sign-ups. In anticipation of a slowdown, shares of Rogers Communications (RCI), BCE (BCE), and Telus (TU) are all down year-to-date. Telus operates mainly in the West, so the impact of falling immigration rates is less.
Your Takeaway
Expect tariffs to raise the price of automobiles. This will hurt an already weak sector.
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