Trade war impact: 12.5 million cars lost globally by the end of 2026 and a $30 billion annual hit to OEM bottom lines
- Tamas Rozsa
- May 13
- 2 min read
According to our latest forecast at Top Tier Consultants, the global automotive industry is entering a critical adjustment phase triggered by newly proposed U.S. tariffs on imported vehicles and components. We see the trade war impact: 12.5 million cars lost globally by the end of 2026 and a $30 billion annual hit to OEM bottom lines is reshaping the competitive landscape of the global automotive sector.
While 2025 will reflect only a partial-year effect, 2026 will mark the first full year under the new tariff regime. By 2027, most OEMs are expected to implement structural responses through supply chain localization and footprint adjustments. However, the interim disruption is substantial:
12.5 million fewer vehicles are expected to be sold globally across 2025–2026.
The annual profit impact on global OEMs is projected to reach $30 billion.
Western OEMs are disproportionately affected, while Chinese OEMs, with more contained exposure to the U.S. market, show greater resilience.
At Top Tier Consultants, we have identified four distinct strategic response groups based on U.S. sales volume and import exposure. Each faces a different scale of financial and operational pressure:
Home Advantage Players
(Ford, Tesla)
These OEMs benefit from a strong U.S. manufacturing footprint and are best positioned to gain share in a shrinking market.
➡️ Estimated annual impact: $1.5 billion
Even these players will not escape unscathed, with higher input costs and supply chain adjustments contributing to profitability erosion.
Vulnerable Volume Players
(Toyota, Hyundai–Kia, GM)
Combining high volumes with significant import exposure, these OEMs are the most directly affected and will need to accelerate localization to mitigate losses.
➡️ Estimated annual impact: $13 billion
This group bears nearly half of the total industry loss, and their strategic response will shape market dynamics in the next 24 months.
Tariff Targets
(Volkswagen, Volvo, Mazda, Jaguar Land Rover)
Highly import-dependent and lacking sufficient U.S. production capacity, these OEMs face difficult choices — either scaling back or pursuing targeted exemptions.
➡️ Estimated annual impact: $4 billion
Some may turn to government negotiations; others will face painful volume declines or margin compression.
Collateral Damage Group
(BMW, Mercedes-Benz, Nissan, Subaru, Stellantis)
These OEMs pursued balanced global strategies with substantial U.S. manufacturing. Despite not being the primary policy targets, they suffer significantly due to broad tariff scope.
➡️ Estimated annual impact: $9 billion
This group absorbs nearly 30% of total losses, highlighting the unintended consequences of blunt policy tools on globally integrated players.
Understanding where each OEM stands — and how exposed their footprint truly is — is essential for navigating this next phase of global realignment.
If you would like to explore the full dataset and underlying methodology — or discuss strategic implications for your business — we welcome the opportunity to connect.