(MENAFN) European steel companies saw a notable boost in their share prices Wednesday after the European Commission announced a plan to raise steel tariffs and significantly reduce import quotas to protect the industry. Meanwhile, shares in European automakers fell amid concerns over rising costs.

By 1130GMT, Sweden’s SSAB shares were up 3.7%, Germany’s Thyssenkrupp climbed more than 5.4%, and Luxembourg-based ArcelorMittal increased 4.4%. Austria’s Voestalpine Group rose 1.5%, and Germany’s Salzgitter Group gained 3%.

The Commission’s new measures aim to provide strong and lasting support for the EU steel sector by imposing a 50% tariff on surplus steel imports and cutting tariff-free import levels to 18.3 million tons annually, representing a 47% decrease from 2024 limits.

However, the European Automobile Manufacturers' Association (ACEA) expressed concerns that the tariff hikes and quota reductions could drive inflation across Europe.

Following this warning, auto stocks declined. The Stoxx 600 Automobiles and Parts index fell 1.6%, with Germany’s BMW leading the losses at nearly 8%. Shares of Mercedes-Benz Group, Porsche, and Volkswagen each dropped more than 2%, while Renault and Stellantis shares declined 2.5% and 0.3%, respectively.

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