High Costs of U.S. Tariffs Impact Mercedes-Benz, Porsche, and Aston Martin
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Car manufacturers worldwide are feeling the sting of U.S. tariffs implemented during Donald Trump’s trade war. Mercedes-Benz has announced that it anticipates a staggering €362 million (£313 million) loss due to these tariffs, while the renowned German sports car maker Porsche estimates its losses at €400 million. Similarly, British luxury carmaker Aston Martin Lagonda has opted to reduce production and limit exports to the U.S. in an effort to mitigate financial repercussions.
The Trump administration’s tariffs—initially set at 27.5% on car imports from the EU and UK—have thrown many German and British automakers into turmoil. However, the recent EU trade agreement will reduce this figure to 15%, and the UK has secured a 10% tariff for the first 100,000 exports on a first-come, first-served basis.
Mercedes-Benz expressed that these tariffs are “causing great uncertainty,” leading to a 9% decrease in sales year-on-year, with a total of 453,700 units sold in the second quarter. Reports indicate that these tariffs could reduce profits by approximately 1.5 percentage points, which translates to a financial impact of €362 million on the division’s adjusted operating profit.
Ola Källenius, the CEO of Mercedes-Benz, commented, “Despite the dynamic business environment, we achieved robust financial results in the second quarter. Our best response is to remain focused on delivering desirable and intelligent products while maintaining strict cost control.”
Porsche also reported that the introduction of U.S. tariffs has resulted in additional costs of €400 million in the first half of the year, as the company has sought to shield customers from price hikes.
At the Aston Martin St Athan factory near Barry, Wales, paint technicians prepare the first production of the DBX 707. The effects of Trump’s trade war are notably felt in the UK, where Aston Martin had to curtail production and manage inventory at U.S. dealerships to avoid the 27.5% tariffs. Fortunately, these tariffs were reduced to 10% following the UK’s trade deal with the U.S.
Aston Martin’s CEO, Adrian Hallmark, stated, “The evolving and disruptive U.S. tariff situation has been detrimental to our operations in the second quarter. We adjusted production and limited imports during April and May while awaiting confirmation of a trade agreement between the UK and the U.S. We leveraged existing inventory held by our U.S. dealers during this time and resumed shipments in June in anticipation of the final agreement, which took effect on June 30, 2025.”
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- 9 AM BST: Germany GDP growth rate (Q2; previous: 0.4%; consensus: -0.1%)
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Stay tuned for more updates on how these developments impact the automotive industry and the broader economic landscape!
