It needs to be seen on how higher tariffs are absorbed across the supply chain that includes customers, OEMs and suppliers.
FinTech BizNews Service
Mumbai, April 3, 2025: DONALD J. TRUMP, President of the United States of America, has announced new country-specific Tariff rates on over 180 countries of the world. TRUMP has announced 10% baseline Tariffs.
Arun Agarwal, VP – Fundamental Research – Automobiles, Kotak Securities, has shared likely tariff impact on the Auto Sector:
"US has imposed 25% tariffs on imported cars, light trucks and select auto parts sourced from outside of North America. Further, almost 150 auto parts will face tariffs at similar rate. This move could result into increase in car prices in the US and cost pressure for component suppliers. In the event of car prices going up, the US car market may witness a steep volume decline and that can impact revenue for component players supplying parts to the US car/light truck industry. Further, margins of suppliers may come under pressure as they may need to partly absorb cost pressures. We believe there will be some impact, which the suppliers will have to bear, leading to negative implications on margins. Having said that, it needs to be seen on how higher tariffs are absorbed across the supply chain that includes customers, OEMs and suppliers. The extent of impact for Indian players will also depend on the US-India bilateral agreement over the next few months."
