When Trump vowed to impose tariffs on European cars, Ford and GM stock plunged

The escalating economic conflict with the European Union is proving dangerous for American car companies.

After President Trump announced Friday that he would impose a 20 percent tariff on all cars imported from the EU, shares for both European and American car companies plummeted, reports Bloomberg.

Trump sought to punish the EU for its retaliatory tariffs, which included tariffs on about $3.3 billion worth of American goods, including bourbon, orange juice, peanut butter, and motorcycles. The tariffs, mostly at 25 percent, are designed in part to "make noise" by targeting politically important states like Kentucky, Florida, and Wisconsin, EU trade commissioner Cecilia Malmstrom said.

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Trump punched back by commanding that U.S. car companies "build them here," but investors were wary of his move. The president wants the EU to walk back its import barriers to U.S. goods "soon," but it seems market-watchers aren't holding their breath. Shares of Ford, Tesla, Chrysler, and General Motors fell rapidly after Trump announced the forthcoming tariffs, and Bloomberg reports that Volkswagen, Daimler, and BMW each fell in Frankfurt. Lawmakers have criticized Trump's decision to target the auto industry, arguing that his claims that auto imports threaten the country's defense capabilities are baseless. Read more at Bloomberg.