While Trump has hinted at possible assistance for the automotive industry, executives remain apprehensive that without substantial policy changes, all carmakers will suffer from the adverse effects of tariffs.

Industries are urged to diversify their supply chains away from dependence on China, particularly for essential raw materials in steel, semiconductors, and automotive sectors, which necessitates regional cooperation.

WTO Director-General Ngozi Okonjo-Iweala has expressed concerns that a fragmented global economy could result in a nearly 7% decline in global GDP.

The automotive sector, once thriving under postwar globalization, is now grappling with significant challenges due to escalating US-China economic tensions, particularly following Trump's imposition of a 25% tariff on foreign-made cars and parts.

Singapore's Prime Minister Lawrence Wong has observed a global trend where nations prioritize their own interests, while Poland's Prime Minister Donald Tusk cautions against 'naive globalization.'

The rise of protectionism and the decoupling of the US and China are disrupting intricate global supply chains, impacting various industries including automotive, technology, and consumer goods.

Setting up new manufacturing plants in the US presents complexities and high costs, as necessary equipment and materials are often sourced from abroad, leaving executives uncertain about their investments.

Political leaders across Asia and Europe are signaling the end of an era of global trade prosperity, a shift that coincides with the turmoil of Trump's tariff war.

Executives within the automotive industry are increasingly vocal about the risks associated with ongoing tariff negotiations, with Stellantis chair John Elkann warning that these policies could lead to job losses and a decline in the sector.

One automotive executive cautioned that if current policies persist, the industry may face downturns reminiscent of the crises following the Covid-19 pandemic and the 2008 financial crisis.

In response to tariffs, companies are adjusting their supply chains; for instance, Honda is relocating production of its Civic hybrid from Japan to the US, while Volvo is contemplating an expansion of its US manufacturing.

To mitigate risks, executives emphasize the necessity of securing two sources for every critical part, highlighting the importance of collaboration across the EU, US, and China.