The United States and the European Union have struck a trade agreement that trims the tariff on cars shipped across the Atlantic to 15%, down from the 27.5% levy Washington previously imposed. As part of the accord, announced on Sunday, Brussels also pledged to purchase about $600 billion of US energy and military equipment and to increase investment in the country. European auto stocks reacted positively. Volkswagen AG and Mercedes-Benz Group AG opened higher on Monday, recouping some of the ground lost after Volkswagen last month cut its 2025 revenue and profit guidance, citing the weight of US duties. The industry has argued that the earlier tariff regime eroded competitiveness in the world’s second-largest car market. The deal is also expected to buoy Indian suppliers with footprints in both regions. Tata Motors Ltd., owner of Jaguar Land Rover, sources vehicles for the US from its plant in Slovakia; the new rate lowers its export duty burden. Component makers Sona BLW Precision Forgings Ltd., whose US sales account for 43% of revenue, Samvardhana Motherson International Ltd., and Bharat Forge Ltd. could likewise benefit from smoother trade flows between their major customers on either side of the Atlantic.