U.S. President Donald Trump ‘s escalating threats to impose tariffs on neighboring countries , on the European Union and on car manufacturers have hit the automotive industry hard. Shares of some of Europe’s biggest automakers traded lower on Friday, extending sharp losses from the previous session after Trump floated the possibility of a 25% tariff rate on European cars and other goods. The announcement marked the latest in a series of trade measures that appear designed to rebalance the economic order in America’s favor. Trump has previously said he intends to impose auto tariffs of around 25% from as early as April 2, adding that these duties could go “substantially higher” over the course of a year. It is not clear whether these measures would apply to all vehicles coming into the country, or if they’d be targeted toward specific countries. Analysts expect car levies to have a profound impact on the automotive industry, citing a heavy reliance on manufacturing operations across North America, particularly in Mexico, and complex global supply chains. “The general story is that all [carmakers] are highly globalized and so it will affect them all,” Rico Luman, senior sector economist for transport and logistics at Dutch bank ING, told CNBC over video call. “It is a matter of raising costs in the end because it is almost unthinkable that all of the production will shift to the U.S.,” Luman said. Who will suffer the least? Trump has repeatedly raised the threat of tariffs since coming into office, seeking to make levies on foreign goods a core part of his economic agenda. Alongside the prospect of U.S. tariffs on the EU and, separately, duties on automakers, Trump said last week that his proposed 25% tariffs on Mexico and Canada would come into force on March 4. China, which already faces 10% tariffs on its products, is expected to be charged with an additional 10% tariff on the same date. ING’s Luman said elevated uncertainty about the rollout of U.S. tariffs was making it challenging for auto executives to make long-term and typically costly strategic decisions. “It’s extremely difficult to look ahead a couple of quarters from here and that makes it extremely difficult for management boards to navigate the future,” Luman said. “The result of this all may also be trending down confidence on the consumer side, so it may also affect the demand side in the end. It’s not a bright story in that respect,” he added. “There is quite some pain here in the automotive [sector] and it will take a very long time until all the cars are produced domestically, if you like to end up there. So, who will suffer the least? That’s a good one, [but] I can’t really say at this point I’m afraid,” Luman said. Market share challenges Some European car manufacturers have announced significant investments in U.S. production. Germany’s crisis-stricken Volkswagen , for example, has said it plans to make additional investments in the U.S., seeking to double its market share in the country. Stellantis , meanwhile, has plans focused on increasing market share and growing sales volume in the U.S., according to an internal memo. It is set to invest more than $5 billion in the region. The multi-billion dollar investment was announced in late January, days after Stellantis Chairman John Elkann met Trump ahead of the U.S. president’s inauguration. The multinational conglomerate, which recently posted a 70% drop in full-year profit, owns household names including Jeep, Dodge, Fiat, Chrysler and Peugeot. Rella Suskin, equity analyst at Morningstar, said Trump’s levy threats were likely a negotiating tactic aimed at equalizing U.S.-EU auto tariffs. She warned, however, that higher duties for the industry could significantly impact the export strategies of some companies. “European automakers may face challenges in maintaining market share, as most would struggle to pass such tariffs onto consumers or absorb the cost themselves given already thin margins,” Suskin said. “This could prompt further investments in US manufacturing capacity, as some automakers, such as Volkswagen and Stellantis, have begun doing. However, brands like Audi and Porsche may face added vulnerability due to their limited US-based production,” she continued. “For automakers like BMW and Mercedes , who already have substantial US production, higher tariffs could influence their export strategies, potentially reducing productivity and limiting export revenues for the US itself if the EU were to retaliate,” Suskin said. In response, a spokesperson for Mercedes told CNBC that a general trend toward protectionism will have “negative economic consequences for all stakeholders involved.” The firm said it is closely monitoring further developments, but declined to comment further on any speculation regarding tariff levels. CNBC has also contacted BMW for comment.