Shares in Mercedes-Benz slipped slightly on Wednesday morning after the carmaker withdrew its full-year outlook and announced a drop in earnings.
The Stuttgart-based firm’s stock had dropped more than 1% by midday CEST as investors feared the fallout of trade barriers imposed by the US administration.
“The US tariff policy, as well as the countermeasures of other governments and the associated changes in tariff rates, are leading to considerable uncertainty for the world economy,” Mercedes-Benz said in a press release.
The carmaker noted that it was still too early to assess the full consequences of President Donald Trump’s trade policies, notably given the uncertainty around tariff measures.
Mercedes currently makes cars in a number of different locations, with a heavy presence in Germany. The carmaker has a plant in Tuscaloosa, Alabama, and it noted earlier this month that it may ramp up production in the US in response to tariffs.
Mercedes’ earnings before interest and taxes dropped 41% year-on-year to €2.3 billion in the first quarter of 2025, the carmaker announced on Wednesday.
Net profit plummeted 43% to €1.7bn, while revenue fell 7% to €33.2bn.
In Mercedes’ car division, the adjusted operating margin fell 1.7 points to 7.3%.
Trump’s concession to carmakers
The carmarker’s tariff warnings come after the US administration offered a ray of hope to the auto industry on Tuesday.
President Trump signed an executive order to reimburse some levies on auto parts sent to the US.
On top of this, businesses that pay duties on cars and parts will not have to pay the additional tariffs that Trump has imposed on steel, aluminium and goods from Canada and Mexico.
Tariffs of 25% on foreign cars sent to the US came into effect earlier this month, while duties on foreign auto parts are set to kick in on Saturday.
Other carmakers sounding the alarm over tariffs include Stellantis, Volvo, and General Motors, who have all withdrawn forecasts in response to Trump’s trade war.
Volkswagen on Wednesday reported a 37% year-on-year drop in first-quarter profit, which came to €2.9bn. VW maintained its full-year outlook.
Source: Euro News
