Due to Uncertainty from Trump's Tariff Policy, Stellantis Pauses Full-Year 2025 Forecast

Taiwan • Business • 04/30 09:30
Due to Uncertainty from Trump's Tariff Policy, Stellantis Pauses Full-Year 2025 Forecast

On April 30, 2025, global automaker Stellantis announced that due to the frequent changes in President Trump's tariff policies on imported cars and components, creating an uncertain market outlook, the company has decided to withdraw its financial guidance for the full year 2025 and reassess its capital expenditure plans. Other automakers, such as General Motors and Mercedes-Benz, have also withdrawn their financial forecasts due to tariff uncertainties, highlighting the automotive industry's significant concern over changes in U.S. trade policies.

Key Updates

05/01 09:30

U.S.-China Trade War Heats Up: How American Investors Can Handle Market Risks and Economic Shocks

Amid the escalating US-China trade war and the turmoil in global supply chains, the US stock market has demonstrated resilience. Despite the first quarter GDP contraction, the S&P 500 index has only decreased by 2.4% since the announcement of tariffs. Investors underestimated the impact of the trade war and adjusted their asset allocation strategies to favor defensive assets. The dollar index declined, and international funds flowed to Europe and emerging markets. Companies are reorganizing supply chains to address risks. Small-cap stocks are facing both challenges and opportunities, consumer confidence is waning, and corporate investment remains hesitant.

05/01 00:41

Progress in tariff negotiations between the Trump administration and India: Plans to use the cancellation of the AI chip export classification system as trade leverage

At the end of April 2025, President Trump of the United States stated that the U.S.-India tariff talks are going smoothly, and a trade deal is expected soon. Officials from the U.S. Department of the Treasury and the Department of Commerce highlighted that India could be among the first to sign a trade deal in Trump's second term. Meanwhile, the Trump administration is considering scrapping the AI chip export classification system from Biden's time, choosing instead to use intergovernmental agreements for export authorization, using AI chips as a bargaining chip in trade talks, which could deeply impact the global semiconductor supply chain.

04/30 14:33

China canceled an order for 12,000 tons of U.S. pork: escalating U.S.-China trade tensions, severely impacting the U.S. supply chain.

In April 2025, China canceled an order for 12,000 tons of U.S. pork imports, marking the largest cancellation record since 2020, due to U.S. tariff measures. This move led to significant inventory and value losses for U.S. exporters, impacting the agricultural supply chain and the slaughtering and processing industries. Tariffs up to 172% limit the competitiveness of U.S. pork in the Chinese market, and China's unique demand for pork by-products makes it challenging for alternative markets to absorb the supply. The U.S. holds advantages in cost and supply flexibility, but in the short term, the market gap and pressures from supply chain adjustments are significant.

04/30 13:31

In April 2025, private sector job growth in the United States slowed to 62,000, marking a nine-month low.

In April 2025, the U.S. private sector added 62,000 jobs, which was below the expected range of 115,000 to 125,000, representing the smallest increase since July 2024. ADP data shows that companies are cautiously expanding their workforce due to uncertainties in policy and consumer behavior. This report was released two days before the U.S. Department of Labor's non-farm employment report, offering the latest insights into the labor market.

04/30 11:04

China plans to exempt certain American goods from the 125% tariff, focusing on textile and semiconductor companies.

The Chinese government is implementing a tariff exemption policy, exempting certain American goods from the 125% retaliatory tariffs, including ethane, certain pharmaceuticals, aircraft engines, and some semiconductor products. Local governments are conducting investigations into textile and semiconductor companies to evaluate the impact of the trade war. Companies must verify if their imported goods qualify for the exemption. The policy has yet to be officially announced, indicating a pragmatic adjustment by China despite maintaining a tough stance.

04/30 09:30

Due to Uncertainty from Trump's Tariff Policy, Stellantis Pauses Full-Year 2025 Forecast

On April 30, 2025, global automaker Stellantis announced that due to the frequent changes in President Trump's tariff policies on imported cars and components, creating an uncertain market outlook, the company has decided to withdraw its financial guidance for the full year 2025 and reassess its capital expenditure plans. Other automakers, such as General Motors and Mercedes-Benz, have also withdrawn their financial forecasts due to tariff uncertainties, highlighting the automotive industry's significant concern over changes in U.S. trade policies.

04/30 09:02

EVA Air's Response to U.S. Tariff Policies: Adjusting Flight Routes and Adding Cargo Flights to Southeast Asia

In response to the U.S. reciprocal tariff policy, EVA Air is closely monitoring the changes in passenger demand during the summer and anticipates a shift in some cargo volume from China to Southeast Asia. The company has launched a route adjustment plan, aiming to add cargo flights to destinations like Penang, Hanoi, and Bangkok. General Manager Sun Chia-ming mentioned that passenger transport saw growth in the first quarter, while the cargo market is adjusting its routes due to supply chain shifts, allowing for a flexible response to market changes.

04/30 07:05

S&P Global: The trade war will not affect the credit ratings of the US and China in the short term. According to S&P Global, following Trump's tariff hikes, the US rating remains stable, while China's rating has been downgraded by Fitch.

In early April 2025, President Trump of the United States announced tariffs on global goods imported into the U.S., raising market concerns regarding the sovereign credit ratings of both China and the U.S. S&P Global indicated that in the short term, the trade war would not directly impact the sovereign credit ratings of China and the U.S., maintaining a stable outlook for the U.S.'s AA+ credit rating and noting the resilience of China's A+ credit rating. However, after Trump's announcement of tariffs, Fitch downgraded China's credit rating by one notch, becoming the first major agency to adjust China's credit rating.

04/30 05:03

US Companies Stockpile Inventory to Mitigate Tariffs, First Quarter Economic Data Affected

In early April, U.S. President Trump announced a 145% tariff on Chinese products. To avoid the high tariffs, companies significantly increased imports in March, leading to the U.S. trade deficit expanding to a record high of $162 billion. This move increased the total import amount, negatively affecting the GDP for the first quarter of 2025, with the possibility of economic growth stalling or contracting. Multiple institutions forecast a decline in first-quarter GDP, highlighting the direct impact of trade policy on economic activity.

04/30 05:03

Adidas is under pressure to raise prices due to high tariffs imposed by the US, and the CEO warns that the Samba and Campus shoes might be affected.

The German sports brand Adidas experienced a 155% increase in net profit and a 12.7% increase in revenue in the first quarter of 2025. However, as a result of the high import tariff policies implemented by former U.S. President Trump, CEO Björn Gulden warned that the prices of shoes such as the Samba and Campus models might increase in the U.S. Given the uncertainty surrounding tariff policies, Adidas has not adjusted its full-year financial forecast and stated that it is unable to predict how price increases will affect consumer demand.

Stellantis Withdraws Full-Year Financial Outlook: Tariff Policy Becomes Major Variable

Stellantis announced in a statement on Wednesday that due to the frequent changes in tariff policy on automobile imports and components implemented by U.S. President Trump, the company cannot accurately predict market demand and the competitive landscape, thus deciding to withdraw its full-year financial outlook for 2025. The company stated: "Due to the ongoing evolution of tariff policies and the difficulty in predicting their potential impact on market sales and the competitive environment, we have decided to suspend the original full-year performance guidance."

Stellantis is the world's fourth-largest automaker, owning brands such as Jeep, Dodge, Fiat, Chrysler, and Peugeot. According to the company's first-quarter 2025 financial report, net revenue was 35.8 billion euros, down 14% from the same period last year, mainly due to reduced shipments, an unfavorable product mix, and the normalization of prices. Although revenue slightly exceeded the market expectation of 35.4 billion euros, the company still stated that it would reassess capital expenditure plans and adjust production and workforce allocation to mitigate potential impacts on profits.

Trump's Tariff Policy Causes Industry Unease

On April 3, 2025, the U.S. government officially imposed a 25% tariff on all imported cars and plans to impose the same rate on imported auto parts starting May 3, leading to a strong backlash from the automotive industry. Although Trump signed an executive order on April 29 to adjust some tariff policies, including avoiding double taxation on the same vehicle or part with both steel and aluminum taxes and auto taxes, and providing a two-year partial tax credit for vehicles completed in the U.S., the overall policy remains uncertain.

According to the U.S. Department of Commerce, the new executive order will allow automakers completing final assembly in the U.S. to receive a tax credit equivalent to 15% of the vehicle's suggested retail price in the first year and 10% in the second year. Additionally, the 25% tariff on imported parts will still be imposed as scheduled, but manufacturers may apply for compensation, with the first-year compensation cap at 3.75% of the vehicle's value, decreasing to 2.5% in the second year, and eliminated from the third year onward.

However, these buffer measures have not completely alleviated industry concerns. Stellantis stated in its announcement: "We will continue to work with the U.S. government to evaluate the impact of tariff policies on our North American operations and adjust our operational strategy to respond to changes."

Industry Chain Reaction: Multiple Automakers Simultaneously Withdraw Financial Forecasts

Stellantis is not the only automaker adjusting its financial expectations due to tariff policy uncertainty. General Motors (GM) and Mercedes-Benz also announced this week the withdrawal of their 2025 financial forecasts. GM stated that although first-quarter performance was strong, it could not make an accurate full-year profit forecast before the tariff policy becomes clear. The company's earnings call originally scheduled for April 29 has also been postponed to May 1.

Mercedes-Benz pointed out that U.S. tariff policies and potential countermeasures from other countries have created significant uncertainty for the global economic outlook, making it challenging for the company to offer forward-looking financial forecasts.

Additionally, Stellantis experienced a significant 64% drop in operating income (AOI) in 2024 due to poor performance in the U.S. market, resulting in a cash burn of over 6 billion euros. The company replaced its CEO last December, and the new CEO is expected to announce plans by the end of June.

Background of Tariff Policy and Industry Response

The tariff policy promoted by the Trump administration aims to incentivize automakers to bring their supply chains and production bases back to the U.S. According to U.S. Department of Commerce officials, these measures will provide companies with a two-year transition period to adjust their supply chain structures. Trump stated at a rally in Detroit: "We just want to help them through this transition period, and if they can't get parts, we don't want to punish them."

However, industry groups and analytical institutions generally maintain a cautious stance towards the policy's effectiveness. The six major U.S. automotive policy groups jointly wrote to the White House, warning that high tariffs could lead to increased car prices, decreased sales, and supply chain disruptions. The Center for Automotive Research estimates that the total costs for U.S. automakers are expected to increase by approximately $108 billion due to tariffs in 2025.

Of the 1.2 million vehicles Stellantis sold in the U.S. in 2024, over 40% came from Mexico and Canada. Facing the new tariff policy, the company has reduced the number of imported vehicles in April and relied on existing inventory to meet market demand.

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