Threat of Mexican tariffs, US companies in the crossfire on WTOP| The surprise announcement by President Donald Trump of an escalating tariff regime against Mexico is sending ripples through almost every economic sector in the U. S., pulling at the shares of companies that make cars, operate…
The surprise announcement by President Donald Trump of an escalating tariff regime against Mexico sent ripples through almost every economic sector in the U. S., hammering American companies that sell automobiles or run railroads, grow vegetables or build power infrastructure.
Trump tweeted late Thursday that he is slapping a 5% tariff on all Mexican imports, effective June 10, and will raise those tariffs to 25%, “until the Illegal Immigration problem is remedied.”
Whether it’s avocadoes on a taco or a new Chevrolet Blazer SUV in the driveway, if the tariffs go into effect, Americans could feel it.
The companies that produce such goods felt it immediately Friday.
Shares of General Motors Co., which imports more vehicles into the U. S. than any other automaker, slid 4% at the opening bell. European and Asian automakers ship cars across the border to the massive U. S. market as well. Fiat Chrysler and Nissan Motor Co. both tumbled more than 5%
“For GM, we roughly estimate that a 5% tariff could be a several-hundred-million dollar annual earnings hit,” said Itay Michaeli of Citi Investment Research.
That potential damage rippled outward to auto suppliers. American Axle & Manufacturing Inc. slid 4%.
All of the 11 sectors in the S&P 500 were getting hit Friday, save for utilities because there is no or little cross boarder traffic in that sector.
