The Trump administration has prepared a report for the president himself that once again brings up the possibilities of auto tariffs on the European Union. The tariffs could be as much as 25 percent on European-built cars imported to the U.S., which has the auto industry urging President Trump to forego them.
Reuters reported the U.S. Commerce Department delivered the report to the Trump administration Sunday evening after the administration declared it would investigate European-imported cars as a national security threat to the U.S. The industry balked as it discovered the national security report is shrouded in secrecy, which makes it difficult for automakers to react in the 90 days President Trump has to make his decision.
The Motor and Equipment Manufacturers Association said in a statement that it was “alarmed and dismayed” at the decision. It added if tariffs are recommended and imposed, they “will put jobs at risk, impact consumers, and trigger a reduction in U.S. investments that could set us back decades.”
The 25 percent tariff would, for example, add over $10,000 to the price of a luxury vehicle built in Germany.
The Trump administration has argued in the past that the threat of tariffs will help secure concessions from the EU in a trade deal. The two decided to call a truce on possible tariffs as long as discussions persisted and were productive.
Bloomberg reported Tuesday that the EU has already drafted retaliatory tariff measures in the event its auto industry is slammed with new U.S. tariffs. According to the report, the tariffs amount to $23 billion in U.S. goods.