PACCAR Stock Jumps Over 5% on New 25% Heavy Truck Tariff
Import duty announced to shield US manufacturers from foreign competition, boosting shares of the Kenworth and Peterbilt parent company.
Shares of American truckmaker PACCAR Inc. (PCAR) surged more than 5% in pre-market trading after the White House announced a plan to impose a new 25% tariff on heavy trucks manufactured abroad. The move is designed to bolster domestic manufacturers by making imported vehicles significantly more expensive.
The new tariff, set to take effect on October 1, 2025, targets heavy-duty trucks, a market where PACCAR is a dominant player through its well-known Peterbilt and Kenworth brands. Investors reacted positively to the news, anticipating that the import duty will give the company a stronger competitive advantage against foreign rivals like Sweden's Volvo and Germany's Daimler, which have a significant presence in the U.S. market.
According to the administration, the tariffs are being implemented for national security purposes and to . The policy is expected to have the largest impact on imports from Mexico, which has become the leading exporter of heavy-duty trucks to the United States.
While the move was cheered by investors in domestic manufacturing, it has drawn criticism from industry groups. The American Trucking Associations (ATA) voiced strong opposition, warning the tariff could be detrimental to the very industry it aims to protect. The ATA cautioned that the increased costs would likely be passed on to trucking companies, which operate on thin margins.
that a 25% tariff could inflate the average price of a new Class 8 truck from $170,000 to nearly $224,000 when combined with existing federal excise taxes. Such a price hike could make new vehicles unaffordable for many fleet operators, potentially leading to a sharp decline in truck purchases and forcing companies to delay replacing aging equipment.
The market's immediate reaction, however, focused on the upside for PACCAR. The tariff is seen as creating a protective barrier that could drive more customers toward its American-made trucks, boosting sales and strengthening its market position. The development comes as , with the tariff news providing a specific, powerful catalyst for PCAR shares.