Auto stocks fell victim to more trade war escalation as China said it will raise its tariff on US goods to 84%, in retaliation to President Trump’s tariffs tit-for-tat strategy on Chinese imports that kicked in on Wednesday.

Beijing’s latest move comes after Trump followed through on a threat to add a 50% tariff on Chinese goods, in addition to 34% reciprocal tariffs, raising the overall tariff rate on Chinese goods to 104%.

GM (GM) and Ford (F) dropped on Wednesday morning before recovering, while shares of German automakers Volkswagen (VOW.DE), BMW (BMW.DE), and Mercedes (MBG.DE) fell in overseas trading due to their exposure to the US auto market, where 25% tariffs on all imports are the new reality.

Automakers have been scrambling to respond to the daily drip of tariff escalations that began once Trump started his tariff war in earnest following his April 2 "Liberation Day" event.

Read more: What Trump's tariffs mean for the economy and your wallet

“Across OEMs, we are beginning to see a dispersion of reactions, ranging from immediate price discounts in the near-term (Ford + Stellantis), to others that will hold prices constant at least for the next 1-2 months before [reevaluating the] situation,” Deutsche Bank analyst Edison Yu wrote in a note to clients on Tuesday. “There is also some capacity re-alignment occurring including GM raising output at its Fort Wayne facility and Stellantis pausing some plant operations in Mexico/Canada. In respect to suppliers, Stellantis has been more vocal about helping to absorb costs along with Toyota, although the % of pass-through is still unknown.”

With regard to the crucial auto parts supply chain, it is currently unknown at what level these components — some of which are difficult or impossible to source domestically — will be tariffed. The Commerce Department has until May 3 to provide guidance on those duties.

Believe it or not: The US exports cars to China too

HECTOR RETAMAL via Getty Images

Interestingly, China’s acceleration of tariffs on US products will actually have some impact on autos that are made in the US and destined for Chinese buyers.

According to the China Automobile Dealers Association (as first reported by Automotive News), US vehicle exports to China fell 13% to 109,000 units; however, that made the US the third-largest vehicle exporter to China, behind Japan and Germany.

Ford’s Lincoln luxury brand exported 20,516 vehicles to China, making it the largest American vehicle importer to China. Lincoln’s full-size Navigator SUV is among those products popular in China.

Germany’s BMW exported approximately 20,000 vehicles from the US to China, that are assembled at BMW’s plant in Spartanburg, S.C. SUVs like the X4, X6, X7, and range-topping XM are built at the plant and exported to China.

Rival Mercedes builds a number of vehicles for export at its Tuscaloosa, Ala., plant. The China Automobile Dealers Association (CADA) said Mercedes exports SUVs like the GLE, GLS, EQE, and EQS electric vehicles to China but did not disclose the export quantities.

GM

And GM’s new import unit — dubbed the Durant Guild — started delivering its first US-built products to China, which are full-size SUVs, such as the Chevrolet Tahoe and GMC Yukon.

All in all, while approximately 110,000 vehicles represent a small portion of the total number of vehicles assembled in the US, automakers at this point will take any sale they can get given the hyper-competitive automotive marketplace.

China has a 15% auto tariff on US imports, with tariff escalators based on engine size. US-made vehicles with engine displacements under 2.5 liters will be hit with 49% tariffs starting on April 10, and those over 2.5 liters or more (such as the Lincoln Navigator or Chevrolet Tahoe) will be slapped with 59% tariffs.

Pras Subramanian is a reporter for Yahoo Finance. You can follow him on X and on Instagram.

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