Tata Motors, Samvardhana Motherson, Bharat Forge Stocks Fall As Trump Announces 25% Auto Tariff

Shares of Tata Motors Ltd., Samvardhana Motherson International Ltd., Sona BLW Precision Forgings Ltd. and Bharat Forge Ltd. declined in early trade on Thursday after US President Donald Trump announced 25% tariffs on auto imports starting April 2. These companies have significant exposure to the US market.

Trump signed a proclamation to implement the tariff as he aims to bring more manufacturing jobs to the US.

“What we’re going to be doing is a 25% tariff on all cars that are not made in the United States,” Trump said at the White House on Wednesday.

The tariff would apply not only to fully assembled cars but key automobile parts, including engines, transmissions, powertrain parts and electrical components. That list could expand over time to encompass additional parts, Bloomberg reported.

Tata Motors share price fell 6.7% intraday, losing over Rs 10,000 crore in market cap. Close to 31% of Jaguar Land Rover's retail sales come from the US and models are made in the UK.

Samvardhana Motherson slid 7.6%, while Bharat Forge tanked 4.5%.

All three stocks fell below their respective 200-day moving average.

Auto components companies like Bharat Forge generated 25% of their revenue from the US. Samvardhana Motherson had 18% of its income coming from the world's second-largest auto market.

CLSA noted that SAMIL has manufacturing facilities in the US, including a larger one in Alabama, which could cater to demand from US car manufacturers and therefore would see relatively lower impact.

Sona BLW stock fell 6.8% to hit a 52-week low of Rs 463. The company's exposure to the US in its topline is 40%.

The US currently charges around 2.5% tariff on imports from India on both automobiles and auto parts, while India charges 110% (70% basic custom duty and 40% cess) on fully built cars and 15% tariffs on auto parts.