Auto stocks were reeling under pressure during Thursday’s early trades after U.S. President Donald Trump’s announcement of a 25% tariff on imported cars and light trucks.

Tata Motors fell the most, apart from stocks like Eicher Motors, Sona BLW, and Samvardhana Motherson.

The United States is a crucial market for Tata Motors’ subsidiary, Jaguar Land Rover (JLR), which contributes above 22% of its total sales. The tariff, set to take effect on April 3, 2025, is expected to impact the company’s pricing strategy, supply chain, and overall profitability.

Share Performance and Market Reaction

On March 27, 2025, Tata Motors’ share price fell by 6.31% to ₹663 during early trading hours. As of 11:56 AM, the share was trading at ₹669.45, marking a 5.5% decline on the Bombay Share Exchange (BSE). 

Other major auto stocks, including Ashok Leyland, Mahindra & Mahindra, Hyundai Motor, and Maruti Suzuki, also declined, reflecting broader market concerns over trade tensions and weak demand in key markets.

Impact on Jaguar Land Rover (JLR)

JLR, the luxury car subsidiary of Tata Motors, relies heavily on the U.S. market. The newly imposed tariff could lead to increased vehicle prices, which may affect sales. During a recent investor call, Tata Motors’ management reassured stakeholders about their FY25 EBIT margin target of 8.5%. 

Trump’s Tariff Plan and Global Trade Tensions

President Trump has positioned these tariffs as part of his broader economic strategy to protect U.S. manufacturing and generate revenue. According to Trump, these measures aim to counter trade imbalances and strengthen the domestic auto industry. He confirmed that the tariffs would go into effect on April 3, 2025.

The U.S. administration has suggested selective enforcement, meaning certain countries or industries may receive exemptions. However, the specifics remain unclear. Analysts warn that these tariffs could further strain global trade relations and disrupt supply chains, particularly affecting European and Asian automakers.

Let’s take a look at Tata Motors Factor Analysis scores:

Tata Motors Factor Analysis

Disclaimer

Investments in the securities market are subject to market risks, read all the related documents carefully before investing. This is for informational purposes and should not be considered as recommendations.

Kindly refer to  https://share.market/ for more details.

PhonePe Wealth Broking Private Limited is a member of NSE & BSE with SEBI Regn. No.: INZ000302639, Depository Participant of CDSL Depository with SEBI Regn. No.: IN-DP-696-2022, Research Analyst with SEBI Regn No: INH000013387, BSE RA Enlistment Number: 5887 and Mutual Fund distributor with AMFI Registration No: ARN- 187821. Member ID: BSE- 6756, NSE- 90226. 

Registration granted by SEBI, enlistment as Research Analyst and Certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors

Registered office – 2, Floor 3, Wing A, Block A, Salarpuria Softzone, Service Road, Green Glen Layout, Bellandur, Bengaluru South, Bengaluru, Karnataka – 560103, INDIA.

CIN: U65990KA2021PTC146954.