Automobile stocks plunged in Friday's (June 13, 2025) trade with 14 out of 15 stocks under pressure, at 10:45 AM. Nifty Auto also slipped 2.1 per cent in trade after US President Donal Trump on Thursday warned he may soon hike auto tariffs.
At 10:50 AM, Nifty Auto was down 0.81 per cent at 23,221.6. In comparison, the NSE Nifty index was down 0.84 per cent at 24,679.55.
Among others, Eicher Motors, Bajaj Auto, Tata Motors, and Exide Industries fell over 1 per cent. Only, Bharat Forge shares were trading positive on the index.
What did Trump say on auto tariffs?
According to reports, Trump wants to boost domestic auto manufacturing, a move that could further ratchet up tensions with trading partners. The US President believes raising auto tariffs from their current 25 per cent level could offer further protection for the domestic auto industry, citing General Motors Co.’s plan to invest $4 billion in US plants over the next two years in order to avoid paying duties.
Earlier this month, India had challenged the United States’ imposition of steep tariffs on auto imports by lodging a request for consultations with the World Trade Organisation (WTO) amid ongoing bilateral talks with Washington.
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In a formal communication to the WTO, the US clarified: “The United States is not maintaining these actions pursuant to the safeguards/emergency action provisions in Article XIX of GATT 1994 and the Agreement on Safeguards. These actions are not safeguard measures, and, therefore, there is no basis to conduct consultations under the Agreement on Safeguards.”
To this, the US said that India has "no basis" to seek consultations on the matter as its tariffs on automobiles and auto components do not fall under the category of safeguard measures.
India noted that the tariffs, which took effect on May 3, 2025, were implemented without advance notification to the WTO’s Committee on Safeguards, an action that breaches Article 12.1(c) of the WTO Safeguards Agreement, which requires prior notice before such measures are introduced.
India also formally reserved the right to take retaliatory measures if its consultations with the United States fail to produce a resolution within the 30-day period mandated under WTO rules. In its submission, India stated, “India reserves all its rights under the Agreement Establishing the World Trade Organisation and its Annexes, including the Agreement on Safeguards.”
