The BMW brand logo can be seen on the BMW Four-Cylinder (also known as the BMW Tower and the BMW Skyscraper), the main administrative building and emblem of the automobile manufacturer BMW.
Alliance in pictures | Alliance in pictures | Getty Images
Shares of Europe’s biggest automakers fell on Wednesday amid concerns that the European Union’s latest efforts to protect the internal steel market could threaten the region’s auto sector.
The European Commission, the EU’s executive body, announced plans on Tuesday to increase steel tariffs and sharply reduce import quotas, aiming to offer “strong and permanent protection” to the region’s steel industry.
The proposal includes a push to limit duty-free import volumes to 18.3 million tonnes per year, reflecting a 47% reduction compared to 2024 steel quotas – and to double tariffs to 50% on any excess imports.
The planned measures have not been well received by the European automobile industry.
Europe’s Stoxx Automobiles and Parts index was trading down more than 2.2% around 10:55 a.m. London time (5:55 a.m. ET) on Wednesday, leading to regional losses.
In response to the EU announcement, the European Automobile Manufacturers’ Association (ACEA), an industry lobby group, said the proposal went too far and threatened carmakers with higher input and administration costs.
Sigrid de Vries, director general of ACEA, said that European car manufacturers source around 90% of their direct steel purchases from the EU and that they are “very concerned about the inflationary impact that an effective continuation of safeguard measures will have on European market prices”.
She added: “We do not dispute the need for a certain level of protection for a raw materials industry like steel, but we believe that the parameters proposed by the Commission go too far in partitioning the European market.”
ACEA’s De Vries instead called for “a better balance” between information from European producers and steel users to this extent.
BMW shares fall sharply
Looking at individual actions, Germany BMW fell more than 9% on Wednesday morning, collapsing to the lowest of the pan-European Stoxx 600 index.
The Munich automaker, reportedly on track for its worst trading session since September last year, issued a new profit warning on Tuesday, citing slow growth in China and the lingering impact of U.S. tariffs on imports.
The German Mercedes-Benz group, Porsche And Volkswagenat the same time, were also down more than 2%.
France’s actions Renault and listed in Milan Stellantis were last seen down 1.9% and 0.8%, respectively.
Rico Luman, senior transport and logistics sector economist at Dutch bank ING, called BMW’s earnings warning “disappointing” and not a positive signal given the many challenges facing European carmakers.
“When the second quarter numbers were presented, they were still quite optimistic about their ability to face reality and maintain their margins, but that relative optimism seems to have faded now,” Luman told CNBC via email.
