President Donald Trump announced a 25% tariff rate on all imported vehicles on Wednesday, and investors are spooked.

In a significant move that has shaken the investment world, President Donald Trump introduced a 25% tariff on all imported vehicles. The announcement on Wednesday sent ripples through the auto industry, with stocks of major automakers plunging by Thursday. The tariffs are slated to be implemented on April 3, leaving some room for potential negotiations before the deadline. The stakes are high as nearly half of the 16 million cars sold in the United States annually are produced outside the country, many relying on foreign auto parts also subject to tariffs. JPMorgan analyst Ryan Brinkman called the measure 'draconian,' suggesting an adverse financial impact on the industry, estimating losses could balloon to $82 billion—double previous estimates. General Motors, affected by its dependence on manufacturing in Mexico and Canada, saw a stock drop of 7%. Ford, despite its domestic focus, faces a potential earnings hit of $2-$4.5 billion. European luxury brands BMW, Mercedes-Benz, and Porsche also took a hit, with their stocks declining by around 3%. Meanwhile, U.S.-based manufacturers like Tesla and Rivian saw a 2% stock increase, insulated by their domestic manufacturing. This protectionist move exemplifies Trump's 'America First' policy but could escalate tensions with global trading partners. Analysts are concerned about the broader implications for the U.S. economy, consumer prices, and international trade relations.