Donald Trump threatens 20% tariff on all European cars

Cornelia Mascio
Giugno 23, 2018

It was the first time he had threatened to impose a specific level of tariffs on automobiles from Europe.

The European Union slapped revenge tariffs on iconic United States products including bourbon, jeans and motorcycles on Friday in its opening salvo in a trade war with President Donald Trump.

Currently, the U.S. charges just 2.5% on vehicle imports; this is lower than the EU's 10% and China's 25%, although the latter will lower its tariff to 15% from 1 July.

Some U.S. dealers carrying imported brands appeared sanguine about the potential impact on their business of new tariffs.

Trump had a messy showdown with leaders from Europe and Canada at a recent Group of Seven meeting. BMW has a big plant in Spartanburg, South Carolina, and Mercedes-Benz has a factory in Tuscaloosa County, Alabama.

This week, Daimler told investors that it was bracing for a trade war between Trump, China, and now Europe, and issued guidance for lower profit expectations based lower sales due to escalating tariffs. Several weeks ago, he ordered Commerce Secretary Wilbur Ross to launch what's known as a "232" investigation.

According to people familiar with the deliberations, US Ambassador to Germany Richard Grenell has met with executives at major German automakers, including BMW, Volkswagen and Daimler, to discuss Trump's threat of tariffs.

Asked last week how she would react if Trump went through with his plan to impose tariffs on European Union vehicle exports, German Chancellor Angela Merkel said in an interview: "First we are trying to see if we can prevent that from happening - but I can't predict this, so I don't want to raise any false hopes".

German automotive stocks fell after U.S. President Donald Trump threatened to impose a 20 percent tariff on all European auto imports into the U.S. The government moved forward with tariffs on imported aluminum and steel, prompting retaliatory European Union tariffs on a long list of USA products spanning from pants to motorcycles and canoes. But they lack the flexibility to quickly and inexpensively shift production from one model to another in response to rapidly shifting tariff threats, industry experts said.

"We want to avoid continued tit-for-tat escalation", Slack said. She had earlier sought to dispel anxieties that the situation would become a trade war.

His threat - which if carried out would represent a serious escalation of the burgeoning trade war - comes hours after new European Union tariffs on goods imported from the United States came into force.

President Trump is pushing ahead with his campaign pledge to protect American jobs and has described trading relationships with his neighbours and allies as unfair. Only Royal Enfield motorcycles are exported from India to the United States, and even so, numbers are in the hundreds rather than the thousands.

Together with United States tariffs against Mexico and Canada, the trade battles have raised the spectre of a global trade war, spooking financial markets that fear major consequences to the global economy. Makeup, t-shirts, and cooking utensils are also on the list, as are a variety of US products made from iron, steel, and other metals.

Altre relazioniGrafFiotech

Discuti questo articolo

Segui i nostri GIORNALE