Auto Stocks Tumble: M&M, Hyundai Lead Declines Amid EU Free Trade Deal Concerns

• Auto stocks closed lower on Tuesday, with Mahindra & Mahindra and Hyundai Motor India each falling over 4%.
• The downturn is linked to concerns about increased competition from European luxury car imports due to the India-EU free trade agreement.
• The 'mother of all deals' will make luxury cars from brands like BMW, Mercedes, and Audi cheaper in India through quota-based import duty concessions.
• India's auto sector, strong in cars below Rs 25 lakh, will not see EU exports in this segment; EU's interest lies in higher-priced vehicles.
• The BSE auto index dropped 0.97%, contrasting with gains in the broader BSE Sensex and NSE Nifty.

Why It Matters: Indian auto stocks declined significantly due to fears of increased competition from cheaper EU luxury car imports.