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Automaker stocks surged this week, but don’t be fooled — the rally may be more reflex than recovery.
On April 9, a number of automotive manufacturers, including both legacy companies and electric vehicle (EV) leaders, experienced notable increases in their stock prices. Tesla recorded a rise of 22.69%, while Stellantis saw an increase of 18.64%.
Other manufacturers, such as Honda, Ford, and Mercedes-Benz, experienced increases ranging from approximately 9% to 10%. Additionally, Volkswagen and General Motors also reported gains in their stock prices.
Compared to April 1, many of these same stocks are still in the red. Stellantis is down 8.75%, Ford has slipped 4.43%, and Mercedes-Benz has dropped 4.31%. General Motors and Volkswagen are also lagging behind their monthly highs.
Only Honda and Tesla have managed to hold onto net gains for the month.
The sharp jump appears tied to short-term optimism following news of a 90-day pause on select import tariffs. While this pause temporarily eased investor fears, the more impactful 25% import tax on new vehicles remains firmly in place — and that’s the one automakers are watching closely, Reuters said.
In the face of these tariffs, analysts are hitting the brakes. Firms like Barclays and Morgan Stanley have already downgraded major players like Ford and GM, citing increased production costs and weakening demand across key markets, Reuters said.
The warning signs aren’t just about tariffs, either — inflation, labor negotiations, and shifting consumer behavior are all adding pressure to an already complex equation.
Tesla’s spike might be the biggest — but also the most precarious.
Tesla experienced significant gains this month, helping it move out of a challenging financial position. However, analysts are advising caution due to the company’s strong ties to China regarding both its manufacturing operations and sales channels, Teslarati said.
Ongoing trade tensions between the U.S. and China could potentially impact these advantages. Recently, some analysts adjusted Tesla’s price target downward even after the stock's rally, highlighting that market sentiment may be exceeding underlying fundamentals, The Globe and Mail said.
What this means for the market — and for car buyers.
If tariffs continue, automakers won’t be the only ones footing the bill. Consumers could see higher sticker prices, especially for vehicles with foreign parts or overseas manufacturing. The ripple effect might hit everything from compact sedans to high-end EVs, NPR said.
In the end, this week’s gains may feel like a green light — but for now, the auto industry is still navigating a very bumpy road.
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