Additional Coverage:
Stellantis, the parent company of Jeep, announced on Monday that former President Trump’s tariffs have taken a significant bite out of their profits, costing them hundreds of millions of dollars. Preliminary data for the first half of 2025 shows losses nearing $350 million due to direct tariff payments and production cuts made in response to the policy.
The company’s overall losses for the first half of the year are estimated to be a staggering $2.7 billion. This figure includes the tariff-related expenses, costs associated with improving profitability, and compliance charges related to Trump’s suspension of penalties tied to fuel emission standards.
Sales in North America took a major hit, dropping by 25% in the second quarter of 2025 compared to the same period last year. Stellantis attributed the decline to reduced production and shipments of imported vehicles affected by the tariffs.
The 25% tariffs on imported vehicles, implemented on April 2nd, 2025, impacted the complex supply chain that many automakers rely on, spanning the US, Mexico, Canada, and other countries. At the time, the White House defended the tariffs as a measure to protect national security and boost domestic car manufacturers.
Following the implementation of the tariffs, Stellantis temporarily halted production at plants in Windsor, Canada, and Toluca, Mexico, resulting in 900 layoffs across US facilities in Michigan and Indiana. While the tariffs were later eased by Trump, preventing them from stacking on top of existing steel and aluminum tariffs, the damage appears to have been done.
The preliminary earnings data released by Stellantis underscores the impact of the tariffs, mentioning the policy six times. This data release comes after the company paused guidance in April, aiming to address the discrepancy between analyst forecasts and their actual performance. The company had already projected a challenging year due to adjustments in offerings, inventory reductions, and efforts to improve dealer relationships.
New CEO Antonio Filosa, who took over last month, echoed the sentiment of former CEO Sergio Marchionne, stating, “Mediocrity is not worth the trip,” suggesting a renewed focus on overcoming these challenges.