Back to Normal: U.S. Auto Tariff Threats Return for EU

Matt Posky
by Matt Posky

On Wednesday, President Donald Trump threatened to impose fresh tariffs on European automotive imports if the region can’t work out a trade deal with the United States. The good news is that the U.S. is already in the opening stages of negotiation with the United Kingdom, which is due to leave the EU at the end of January. British Prime Minister Boris Johnson has even said a key benefit of Brexit is the ability to negotiate with countries like the U.S. independently.

Unfortunately, the rest of Europe doesn’t seem as eager to do business — encouraging Trump to fall back to tariff threats. But there’s clearly a retaliatory angle here. In 2018, the EU threatened punitive tariffs on traditionally American items like whiskey and motorcycles as a response to Trump’s intent to impose tariffs on steel and aluminum. He’s targeting French goods this time, mentioning 100-percent fees on imported luxury goods from France (champagne, handbags, etc.), additional levies on digital services, and a 25 percent duty on European cars.

“Ultimately it will be very easy because if we can’t make a deal, we’ll have to put 25 percent tariffs on their cars,” Trump told Fox Business‘ Maria Bartiromo this week.

Mike Manley, Fiat Chrysler CEO and current head of the European automotive lobby group ACEA, was quoted by Reuters as saying Trump ought not to be taken lightly.

“If you look at President Trump’s track record I think he is incredibly serious. If the parties involved approach those discussions in a serious manner it will be possible for an amicable conclusion to be reached,” Manley said at an industry event in Brussels. “An escalation of the tariffs is not to the benefit of anyone.”

Trump said he met with World Trade Organization Director-General Roberto Azevêdo to discuss the president’s frustrations with the organization during the World Economic Forum in Switzerland. “Roberto and I have a tremendous relationship, and we’re going to do something that I think will be very dramatic,” he said.

Azevêdo also spoke at the event, suggesting that the WTO should probably undergo some kind of reformation and noting that he’s already planning meetings in Washington to discuss the matter further.

As for a deal with Europe, the president said he has a deadline in mind but didn’t want to make it public until he was sure. However, he warned that it was “a fairly quick date,” adding that the U.S. had no interest in delaying an agreement.

“I met with the new head of the European Commission, who’s terrific. And I had a great talk. But I said, ‘look, if we don’t get something, I’m going to have to take action’ and the action will be very high tariffs on their cars and on other things that come into our country,” Trump told CNBC, adding that investors shouldn’t panic because the EU “has to make a deal.”

He closed his time at the World Economic Forum by commenting on teenage climate activist Greta Thunberg, who also spoke at the event. Trump recommended the public “reject the perennial prophets of doom and their predictions of the apocalypse … I think that some people, they’ve put it at a level that’s unrealistic, to the point that you can’t live your life.”

[Image: Joseph Sohm/Shutterstock]

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • JD-Shifty JD-Shifty on Jan 23, 2020

    Trump is a dumb con man for dumb people. His online fans and rally crowds are proof.

    • See 3 previous
    • Thornmark Thornmark on Jan 23, 2020

      @dal20402 Trump is a master persuader - just watch him this year - he will destroy his Dem opponent - and the Dems know that and have said that their political impeachment is the the only way to stop him and that has failed amazing w/ 90+% of the trained seal MSM ag/ him, Trump will prevail even if he spends one third of what the Dems spend Bloomberg can spend it all and he's going nowhere - he just went to CA and said that CA was what Americans look up to Is he nutz - half the state of CA wants to leave even though it's gorgeous - because the Dems have turned it into a third world state, with third world income stratification, crime and pestilence - how absolutely clueless is Bloomberg Bloomer went to TX w/ Judge Judy, the most popular woman on tv and got a crowd of 45! She must be disgusted w/ him for that. Just imagine 45 people.

  • Thelaine Thelaine on Jan 27, 2020

    Perhaps the best thing about Trump is that he drives leftists crazy, which clarifies where everyone really stands. For example, the mainstream press has lost its power because he exposed them as Democrats with keyboards and cameras. The leftist Deep State has also been exposed. Like him or hate him, Trump is transformative. No wonder they have been trying to destroy him since day 1.

  • SCE to AUX We don't need no stinking badges.
  • SCE to AUX I've never been teased by a bumper like that one before.
  • 3SpeedAutomatic R&T could have killed the story before it was released.Now, by pulling it after the fact, they look like idiots!! What's new??
  • Master Baiter "That said, the Inflation Reduction Act apparently does run afoul of WTO rules..."Pfft. The Biden administration doesn't care about rules. The Supreme Court said they couldn't forgive student load debt; they did it anyway. Decorum and tradition says you don't prosecute former presidents; they are doing it anyway. They made the CDC suspend evictions though they had no constitutional authority to do so.
  • 1995 SC Good. To misquote Sheryl Crow "If it makes them unhappy, it can't be that bad"
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