Electric vehicle stocks are jolted by heightened China trade war anxiety

The electric vehicle sector followed semiconductor stocks lower on Wednesday on reports the U.S. government may impose further export curb controls on the chip industry and former President Trump questioned whether the U.S. should pay for Taiwan’s defense. Of note, the government is said to be considering an application of the Foreign Direct Product Rule, which would allow the U.S. to exert control over foreign-produced items that contain any American technology. The fear in the EV sector is that a trade war over chips would reverberate across suppliers and impact key U.S.-China partnerships.

Luminar Technologies (LAZR) -17.4%, Lucid Group (LCID) -6.4%, NIO (NYSE:NIO) -6.3%, ZEEKR Intelligent Technology (ZK) -6.1%, Faraday Future Intelligent Electric (FFIE) -5.5%, VinFast Auto (VFS) -4.8%, QuantumScape (QS) -4.5%, Rivian Automotive (RIVN) -4.4%, Canoo (GOEV) -4.3%, Xpeng (XPEV) -4.3%, and Li Auto (NASDAQ:LI) -4.2%.

Tesla (NASDAQ:TSLA) was down 2.66% amid the EV slump, while Ford Motor (F) and Stellantis (STLA) were two of only a few auto stocks showing gains.