The BMW brand logo can be seen on the BMW four-cylinder (also known as the BMW tower and BMW high-rise), the main administration building and landmark of the vehicle manufacturer BMW.
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Shares of Europe’s biggest carmakers traded lower on Wednesday, amid concern that the European Union’s latest efforts to protect the domestic steel market could threaten the region’s auto sector.
The European Commission, the EU’s executive arm, announced on Tuesday that it plans to hike steel tariffs and sharply cut import quotas, seeking to offer “strong and permanent protection” to the region’s steel industry.
The proposal includes a push to limit tariff-free import volumes to 18.3 million tons a year, reflecting a reduction of 47% compared to 2024 steel quotas — and doubling tariffs to 50% on any excess imports.
The planned measures have not got down well within Europe’s automotive industry.
Europe’s Stoxx Automobiles and Parts index traded more than 2.2% lower at around 10:55 a.m. London time (5:55 a.m. ET) Wednesday, leading regional losses.
In response to the EU’s announcement, the European Automobile Manufacturers’ Association (ACEA), an industry lobby group, said the proposal goes too far and threatens automakers with higher input and administrative costs.
Sigrid de Vries, director general of ACEA, said that European carmakers source roughly 90% of their direct steel purchases in the EU and were “most concerned about the inflationary impact that an effective continuation of the safeguard will have on European market prices.”
She added: “We do not contest the need for some level of protection for a commodity industry like steel but we feel that the parameters as proposed by the Commission go too far in ring-fencing the European market.”
ACEA’s de Vries called instead for “a better balance” between the news of European producers and users of steel in this measure.
BMW shares fall sharply
Looking at individual stocks, Germany’s BMW fell more than 9% on Wednesday morning, slumping to the bottom of the pan-European Stoxx 600 index.
The Munich-based carmaker, which is reportedly on track for its worst trading day since September last year, issued a fresh profit warning on Tuesday, citing slow growth in China and the ongoing impact of U.S. import tariffs.
Germany’s Mercedes-Benz Group, Porsche and Volkswagen, meanwhile, were also down more than 2%.
Shares of France’s Renault and Milan-listed Stellantis were last seen 1.9% lower and 0.8% lower, respectively.
Rico Luman, senior sector economist for transport and logistics at Dutch bank ING, described BMW’s profit warning as “disappointing” and not a positive signal regarding the many challenges facing Europe’s automakers.
“During the 2Q figures presentation they where still rather upbeat about dealing with the reality and holding up margins, but that relative optimism seems to have faded now,” Luman told CNBC by email.