US President Donald Trump has imposed a blanket tariff of 25% on foreign auto products, as part of US' new tariff structure announced on Wednesday. This new tariff could have an impact on Indian auto manufacturers, like Tata Motors, Sona BLW and Samvardhana Motherson among others, according to analysts.
India is facing a levy of 27% tariff from the US. Trump said Wednesday he will apply a minimum 10% tariff on all exporters to the US and slap additional duties on around 60 nations with the largest trade imbalances with the US.
Here is a look at auto companies with sizable exposure to the US.
Indian Auto Firms' US Exposure
The auto sector was widely expected to take a hit from the reciprocal tariffs by the US. Tata Motors has the biggest exposure to the country as an Indian original equipment manufacturer, with 23% of revenues coming from US as of fiscal 2024.
Among auto component makers, Sona BLW Precision Forgings Ltd., Samvardhana Motherson International Ltd. and Sansera Engineering Ltd. have exposure to US between 9-40%. Forging companies like Bharat Forge Ltd. and Ramkrishna Forging Ltd. may also be impacted.
Key Indian Players Impacted
Tata Motors
JLR formed 70% of fiscal 2024 revenues for Tata Motors and a strong 78% of overall Ebitda contribution. Trump announced imposing 10% reciprocal rate on UK and that will impact JLR. Currently, JLR has no manufacturing in the US and exports to the same from its manufacturing facilities in Europe and UK.
In FY24, JLR’s 23% revenue and 26% of total wholesale volume came from the US. This essentially means that one out of every fourth cars sold by JLR was in US. That share increased from 26% to 33% in the first nine months of fiscal 2025.
US volumes could fall 25-35% if tariff impact passed on to end-consumers, according to Kotak. While the overall business could see volume impact of 5-10%. This can lead to EPS cuts of around 15-20% for the JLR business.
Investec echoed this, projecting a fall of 2% in EBIT CAGR over FY25-27 for Tata Motors.
Sona BLW
Sona BLW has been the poster boy of EV within the auto component space. Sona has operational plant in Irapuato, Mexico as well as a 10 lakh plant capacity in Michigan for Starter Motors.
For Canada and Mexico, the US has kept the tariff rate at 25%, levied earlier.
Kotak says if OEMs decide to bear half the cost, there can be 400-500 bps impact on Sona BLW’s overall profitability and over 20% impact on their EPS as well.
While, Investec said Sona’s relatively lower average selling price and limited local supply chain exposure makes it less vulnerable.
Samvardhana Motherson
The case for SAMIL is a head scratcher to say the least. While an 18% revenue share from US makes it susceptible to tariffs, SAMIL with its global manufacturing footprint, should be the least impacted, brokerages anticipate.
But the company could see indirect impact due to supplies to foreign OEMs that export to the US. SAMIL supplies to EU OEMs, such as Mercedez, Audi, Volkswagen, BMW and Porsche.
The company has local plants in USA and will not see direct impact, owing to tariffs, according to Kotak. But, due to potential negative implications on overall USA sales, there could be an impact on overall revenue.
Bharat Forge And Ramkrishna Forging
Forging companies derive more than 30% revenue from USA and tariffs would be a second serious blow, after delay in EPA norms. EPA norms were expected to lead to pre-buying in fiscal 2026.
A decent part of revenues is derived from Class 8 where volume implication would be limited, Kotak said. Tariffs on auto components can have severe implication for their margins, which can lead to mid-teens impact to their overall EPS, it said.
Eicher, Balkrishna Industries And Others
For Eicher Motors, FY25 export sales stood at 1.07 lakh and 35% of export volume is from North America, according to Jefferies.
Balkrishna Industries, Timken and CEAT derive around 15-18%, 11-13% and 6-9% of their overall revenues from USA respectively.
Companies which may see marginal impact on their business include Mahindra & Mahindra Ltd., Eicher Motors, Schaeffler India and CIE Automotive India.
RECOMMENDED FOR YOU
Sona BLW Appoints Jeffrey Mark Overly As Chairman
Jun 23, 2025
Brace For Impact, The Most Volatile Month Ahead: Open Interest
Jun 23, 2025
M&M, TVS Motors Are Macquarie's Top Picks As Auto Stocks Upgraded
Jun 20, 2025
Sona BLW Share Price Slips To One-Month Low Post Chairman Sunjay Kapur's Demise
Jun 13, 2025
POPULAR