The GM logo is seen on a water tank of the General Motors assembly plant in Ramos Arizpe, in Coahuila state, Mexico February 11, 2021.
Daniel Becerril | Reuters
As auto stocks reacted to the latest tariff announcement out of Washington, D.C., on Thursday, General Motors took the brunt of the hit.
Shares of GM were down more than 6% in mid-morning trading, far underperforming the likes of Ford and Stellantis, which shed about 3% and 2%, respectively. Tesla stock was up about 6%.
The divergence stems from the amount of vehicles that GM imports, and its exposure to Mexico in particular.
“Tesla and Ford appear to be the most shielded given location of vehicle assembly facilities although Ford does face incremental exposure on imported engines,” Deutsche Bank analysts wrote in a note Thursday. “GM has the most exposure to Mexico.”
President Donald Trump on Wednesday announced his administration would impose 25% tariffs on “all cars that are not made in the United States” and some automobile parts. The executive order signed Wednesday allows for some leniency for components that are compliant with the United States-Mexico-Canada Agreement, but it wasn’t immediately clear what relief that might offer the North American automotive industry.
General Motors stock falls after Trump tariff announcement.
Mexico accounted for 16.2% of vehicle imports into the U.S. as a percentage of sales in 2024, according to GlobalData. That was the largest share of any country, about double the shares of South Korea and Japan, which ranked second and third in terms of import volume, respectively.
Roughly 52% of GM vehicles sold in the U.S. during the first three quarters of 2024 were assembled in the U.S., according to research by Barclays analyst Dan Levy. That leaves 30% assembled in Canada and Mexico, and another 18% brought in from other countries.
Levy also pointed out that GM relies heavily on Mexico and South Korea for production of some of its small crossovers, including its Equinox and Blazer vehicles.
“Roughly half of GM’s US sales are produced in the US, but imported parts are a concern,” he said.
Over the same time period, 57% of Stellantis vehicles and 78% of Ford vehicles sold in the U.S. were assembled stateside. Levy reported Stellantis assembled 39% of its U.S.-sold units in Canada and Mexico, and Ford, just 21%.
Wolfe Research’s Emmanuel Rosner said the tariffs primarily impact foreign-brand automakers, but noted that 15% of GM’s U.S. vehicles come from South Korea.
John Murphy from Bank of America said in comparison to the broader automotive market, GM is “relatively exposed to the tariffs” and may need to rebalance.
GM stock is down 12% year to date. Shares fell sharply in late January after investors worried that the automaker didn’t address concerns about tariffs in its most recent earnings report.
