Ever since the U.S. president-elect threatened to impose 25-percent tariffs on all products from Canada and Mexico starting next January, the industry has been preparing for the worst, even if many analysts see it as a negotiating game. Given Donald Trumps unpredictable nature, worst-case scenarios are possible.

　　Reuters reported that a Standard Post study showed that the threatened new tariffs could reduce automakers combined core earnings by 17 percent. Roughly speaking, those reflect the overall profitability of a manufacturers core activities, i.e. vehicle design, production and sales.

　　According to Standard Post, European and U.S. automakers could lose up to 17 percent of their combined annual profits if the U.S. imposes import tariffs on Europe, Mexico and Canada.

　　Luxury manufacturers such as Volvo and Jaguar Land Rover, which produce mainly in Europe, and the General Motors and Stellantis groups, which assemble a significant volume of vehicles in Mexico and Canada, are most exposed to the threat of higher tariffs, the study found.

　　Analysts and experts fear that tariffs could be most damaging for European automakers such as Volkswagen and Stellantis, as well as their suppliers, than direct tariffs on EU products.

　　The study concluded that the worst-case scenario for automakers would be 20-percent U.S. tariffs on light vehicle imports from the EU and the UK, as well as 25-percent tariffs on imports from Mexico and Canada. In that scenario, GM, Stellantis, Volvo and Jaguar Land Rover could see more than 20 percent of their adjusted profits at risk by 2025.

　　The risk is between 10 and 20 percent for Volkswagen and Toyota, and less than 10 percent for BMW, Ford, Mercedes-Benz and Hyundai.