Buy the dip or catch a falling knife? Five things to weigh before buying European carmaker shares
European carmakers are trading cheaply after a brutal stretch of falling China sales, Chinese EV competition and tariff shocks.
In 30 seconds
- European carmakers including Volkswagen, Stellantis, Mercedes-Benz, BMW and Renault trade at low valuations after two years of falling China sales and EV-transition costs.
- Volkswagen publicly considered closing German plants for the first time in its history; Stellantis lost CEO Carlos Tavares at the end of 2024.
- The EU imposed additional tariffs on Chinese-made electric vehicles in late 2024; US import tariffs added further pressure in 2025.
- Audi's Brussels plant in Vorst ended production in early 2025 with roughly 3,000 jobs lost; Volvo Car Gent remains a major Flemish employer.
Key fact
3,000 jobs Audi's Brussels plant in Vorst ended production in early 2025 with roughly lost; Volvo Car Gent remains a major Flemish employer.
European carmakers — Volkswagen (Germany), Stellantis (the Franco-Italian-American group behind Peugeot, Fiat, Opel and Chrysler), Renault (France), Mercedes-Benz and BMW (Germany) — are the listed manufacturers whose shares the article discusses. They face falling sales in China, price competition from Chinese electric-vehicle makers such as BYD, and the cost of switching to EVs. The EU (via the European Commission in Brussels) sets the tariff and trade framework; Belgium is home to Volvo Car Gent, the former Audi Brussels plant in Vorst, and Euronext-listed importer D'Ieteren.
Background
Europe's carmakers were long seen as stable, dividend-rich industrial champions. That reputation frayed as the industry's centre of gravity shifted toward electric vehicles and toward China, which turned from Europe's most profitable market into its toughest competitor. Volkswagen's willingness to discuss closing German plants and the abrupt 2024 departure of Stellantis chief Carlos Tavares marked how far the crisis had gone.
What to do
Belgian readers weighing these shares should treat cheap valuations cautiously, distinguish sustainable dividends from ones at risk of being cut, and remember that the same forces moving the stock price also affect local jobs — and that this is reporting, not investment advice.
Impact
Regional — Flanders is directly exposed: Volvo Car Gent remains one of the region's biggest industrial employers, while the recent shutdown of Audi's Vorst/Brussels plant, with about 3,000 jobs lost, showed how quickly assembly can vanish. Belgian retail investors also hold auto-linked names such as importer D'Ieteren on Euronext Brussels.
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This story was assembled from verified evidence, with its sources and reasoning recorded as it was written.