"Automakers may indeed see large financial impact and uncertainty from the tariffs, as all major OEMs import a considerable portion of the vehicles they sell in the US from Mexico," Deutsche Bank said.
Additionally, a foreign automaker lobbying group said in a statement to Reuters that tariffs on Mexico's imports "threaten the jobs of tens of thousands of Americans here in the United States."
The big three U.S. automakers each have billions of dollars at stake due both production and suppliers in Mexico. According to Deutsche Bank, GM and Fiat Chrysler import 29% and 24%, respectively, of the total parts for its cars and trucks from Mexico. Ford has the second highest total imported vehicles from Mexico at 17%, Deutsche said.
Deutsche Bank also warned that U.S. investors may be surprised by the amount of full-size pickup trucks and parts that are imported from Mexico. For example, 41% of the nearly 586,000 GM Silverado trucks sold in the U.S. are made in Mexico, the bank said.
"The suddenly renewed potential for tariffs on goods from Mexico revives a risk many believed was largely behind us," Citi Research said in a note to investors. "This new uncertainty is a clear negative for auto stocks and we expect pressure pending further clarity as to how this will play out."
In the scenario where Trump follows through with his threat to raise Mexico tariffs to 25% in the coming months, Deutsche Bank also estimated the profit each of the big three automakers would lose. The firm said the earnings before interest and taxes hit for a 25% tariff would be $6.3 billion for GM, $3.3 billion for Ford and $4.8 billion for Fiat Chrysler.