Trump's Truck Tariffs: Strategic Risks and Valuation Opportunities for Daimler Truck and Traton

The imposition of a 25% tariff on imported heavy-duty trucks by President Donald Trump, effective October 1, 2025, has sent shockwaves through the commercial vehicle sector. This policy, targeting trucks with a gross vehicle weight rating exceeding 26,001 pounds, directly impacts global manufacturers like Daimler Truck and Traton, both of whom have significant exposure to the U.S. market. While the tariffs aim to bolster domestic manufacturing, their economic and strategic implications for these companies—and the broader industry—are complex. This analysis evaluates the long-term risks and valuation opportunities for Daimler Truck and Traton in light of these developments.

Strategic Risks: Tariffs and Operational Vulnerabilities

The tariffs disproportionately affect companies reliant on cross-border production networks. Daimler Truck, for instance, derives 40% of its global sales from the U.S. and operates manufacturing facilities in both the U.S. and Mexico under the USMCA trade agreementDaimler Truck, Traton Slide Over Trump’s Truck Tariffs^[2]. While USMCA allows duty-free trade for compliant vehicles, the 25% tariff on non-compliant imports could erode Daimler's cost advantages. A report by Reuters estimates that the tariffs could reduce Daimler Truck's earnings by €700–800 million annually, though the company may offset half of this through price increases and operational adjustmentsDaimler Truck, Traton shares fall as Trump announces truck tariffs^[1].

Traton, a Volkswagen subsidiary, faces similar challenges. Its U.S. operations depend on imported components, and the tariffs could disrupt its supply chain efficiency. However, Traton's strategic pivot toward electrification—allocating €2.6 billion in R&D for e-mobility by 2026—positions it to mitigate some of these risksTraton adding to electrification investments^[3]. Analysts note that Traton's focus on battery-electric vehicles (BEVs) aligns with U.S. regulatory trends, potentially insulating it from some tariff-related volatilityTraton adding to electrification investments^[3].

Valuation Metrics: P/E Ratios and Analyst Projections

Daimler Truck's current P/E ratio of 12.30 (as of September 25, 2025) reflects investor optimism about its long-term resilience, albeit at a premium to its 12-month average of 10.67Daimler Truck Holding AG PE Ratio (TTM) & PE Ratio (TTM)^[4]. Analysts project a decline to 8.14x by 2026 and 7.4x by 2027, suggesting potential undervaluation if the company navigates the tariff challenges effectivelyDaimler Truck Holding AG PE Ratio (TTM) & PE Ratio (TTM)^[4]. Traton's P/E ratio of 6.768, in contrast, indicates a more conservative valuation, supported by its 9.2% return on sales in Q4 2024Traton adding to electrification investments^[3].

The disparity in valuations underscores divergent investor perceptions: Daimler's higher P/E reflects confidence in its hydrogen and electrification initiatives, while Traton's lower ratio highlights its cost-cutting focus and shorter-term profitability. However, both companies face uncertainty as Trump's tariffs complicate capital allocation decisions.

Long-Term Opportunities: Electrification and Hydrogen Innovation

Daimler Truck's “Stronger 2030” strategy emphasizes flexibility in propulsion technologies, balancing diesel and zero-emission options. The company has postponed its hydrogen-powered GenH2 Truck to the early 2030s but secured €226 million in government funding to develop 100 hydrogen fuel cell trucks by Q4 2026Daimler Truck, Traton shares fall as Trump announces truck tariffs^[1]. This pivot aligns with European regulatory priorities, where hydrogen infrastructure is advancing faster than in the U.S. Meanwhile, Traton's partnership with Daimler and Volvo to install 1,700 green energy charging points across Europe by 2030 reinforces its commitment to electrificationTraton adding to electrification investments^[3].

For investors, the key question is whether these strategic shifts can offset the immediate financial drag from tariffs. Daimler's cost-cutting programs, including a €1 billion savings initiative in Europe and 5,000 job reductions by 2030, aim to restore profitabilityDaimler Truck, Traton shares fall as Trump announces truck tariffs^[1]. Traton's focus on BEVs for long-haul transport, coupled with its joint ventures, suggests a more agile response to U.S. market dynamics.

Conclusion: Balancing Risks and Resilience

Trump's truck tariffs present a dual-edged sword for Daimler Truck and Traton. While the immediate financial impact is significant—particularly for Daimler, whose U.S. operations are more exposed to cross-border production—the long-term strategic moves toward electrification and hydrogen innovation offer a path to recovery. Investors must weigh the short-term earnings risks against the potential for these companies to adapt to evolving regulatory and technological landscapes.