The BMW brand logo can be seen on the BMW four-cylinder (also known as the BMW tower and BMW-Hoogbouw), the most important administration building and recognition point of vehicle manufacturer BMW.
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The shares of Europe's largest car manufacturers were traded lower on Wednesday, due to the concern that the latest efforts of the European Union to protect the domestic steel market could pose a threat to the car sector in the region.
The European Commission, the EU's executive power, announced on Tuesday that it intends to increase the steel rates and to reduce the import quota sharply, in an attempt to offer the steel industry in the region “strong and permanent protection”.
The proposal includes an attempt to limit the tariff -free import volumes to 18.3 million tonnes per year, which reflects a reduction of 47% compared to the steel quotas of 2024 – and a doubling of the rates on surplus import to 50%.
The planned measures did not fall well within the European car industry.
The European Stoxx Automobiles and Parts Index traded on Wednesday around 11:44 am London time (6:44 am et) more than 2% lower, which led to regional losses.
In response to the EU announcement, the European Automobile Manufacturers' Association (ACEA), a lobbying group from the industry, that the proposal goes too far and threatens car manufacturers with higher input and administrative costs.
Sigrid de Vries, director-general of ACEA, said that European car manufacturers are roughly involving 90% of their direct steel purchases in the EU and “are most concerned about the inflatory impact that will have an effective continuation of the safeguarding on European market prices.”
She added: “We do not dispute the need for a certain level of protection for a raw material industry such as the steel industry, but we believe that the parameters as proposed by the committee are going too far in screening the European market.”
Instead, Acea's de Vries called for “a better balance” between the news of European producers and users of steel in this measure.
BMW shares are falling sharp
Looking at individual shares, those of Germany BMW Disconnected on Wednesday morning by more than 8% and dropped to the bottom of the Pan-European Stoxx 600 index.
The car manufacturer based in Munich, who is said to be on track for the worst commercial day since September last year, gave a new profit warning on Tuesday, referring to the slow growth in China and the ongoing impact of American import rates.
Rico Luman, senior sector economist for transport and logistics at the Dutch Bank ING, described BMW's profit warning as “disappointing” and not a positive signal with regard to the many challenges that European car manufacturers are confronted with.
“During the presentation of the figures for the second quarter, they were still fairly optimistic about dealing with reality and maintaining margins, but that relative optimism now seems faded,” Luman told CNBC by e-mail.
the German Mercedes-Benz group, Porsche And Volkswagen had all dropped by more than 2%.
Shares of France Renault and Milan listed Stellantis were last seen 2.5% lower and 0.5% lower.
In the premarket trade in the US there are shares of Ford and listed on the New York stock exchange Stellantis Have last seen slightly higher.
