Auto Giants Hit Hard: How Trump’s Tariffs Have Hit Tata Motors, Ashok Leyland, M&M Stocks Today

Auto shares tumbled on Thursday, March 27, after US President Donald Trump announced a 25% tariff on vehicles not manufactured in the United States. The announcement sent shockwaves through the market, leading to sharp declines in major auto stocks and dragging the Nifty Auto Index down by over 1%.

At 12 noon, the Nifty Auto Index was trading at 21,561.70, down 181.10 points (-0.83%). The sell-off was fueled by concerns over the impact of the new tariffs on Indian auto exporters and component manufacturers supplying to the US market.

Tata Motors Crashes 6.58%; Ashok Leyland, Bajaj Auto Also Fall
Among major losers, Tata Motors saw the steepest fall, crashing 6.58% to Rs 661.35 on the BSE. Ashok Leyland declined 4.60%, while Mahindra & Mahindra dipped 1.70%. Other auto stocks such as Bajaj Auto (-1.48%) and Apollo Tyres (-1.41%) also faced selling pressure.

Auto component makers were not spared either. Samvardhana Motherson International plummeted 7.59%, Sona BLW Precision Forgings fell 6.69%, Bharat Forge dropped 4.28%, and ASK Automotive slipped 1.82%.

Why Is Tata Motors the Worst Hit?
India is not a major exporter of cars to the US, but Tata Motors has significant exposure through its UK-based subsidiary, Jaguar Land Rover (JLR). 

Tata Motors, which owns Jaguar Land Rover (JLR), is significantly affected as JLR heavily relies on the US market. According to JLR's FY2024 report, nearly one-third of its sales came from North America, contributing 22% to its total revenue. The luxury automotive brand, headquartered in the UK, operates manufacturing plants globally, excluding the US.

Auto Ancillaries Suffer as Supply Chain Concerns Grow
The new tariffs also rattled auto parts suppliers, with investors fearing increased costs and potential disruptions to global supply chains. Samvardhana Motherson International, a key supplier to global automakers, bore the brunt of the sell-off, plunging nearly 8%. Other major component makers, including Sona BLW and Bharat Forge, also witnessed steep declines.

Trump’s Justification On Auto Tariffs
Trump justified the tariff as a measure to protect American jobs and domestic manufacturers.

"We’re going to charge countries for doing business in our country and taking our jobs, taking our wealth," Trump said from the White House.
The new 25% tariff applies to imported passenger vehicles, including sedans, SUVs, and minivans, as well as light trucks. Additionally, key auto parts such as engines, transmissions, and electrical components will be affected. The US government may expand the list further in the future.

Stocks That Managed to Stay Afloat
Despite the broad sell-off in the auto sector, a few stocks managed to post gains. Hero MotoCorp rose 2.05%, TVS Motors edged up 0.92%, Maruti Suzuki gained 0.64%, and Exide India was up 0.47% in early trade.