Trump threatens 20% tariff on EU car imports

US president’s tweet on autos comes after EU reprisals against his tariffs

WASHINGTON: President Donald Trump on Friday threatened to escalate a trade war with Europe by imposing 20% tariff on all US imports of European Union-assembled cars, a month after the administration launched an investigation into whether auto imports pose a national security threat.

"If these tariffs and barriers are not soon broken down and removed, we will be placing a 20% tariff on all of their cars coming into the US. Build them here!" Trump wrote on Twitter on Friday.



Trump's tweet on autos came after EU reprisals against his tariffs on European steel and aluminium.

The EU targeted more than $3 billion in American goods exported to the 28-member European Union. The United States currently imposes 2.5% tariff on imported passenger cars from the European Union and 25% tariff on imported pickup trucks. The EU imposes 10% tariff on imported US cars.

German automakers Volkswagen AG, Daimler AG and BMW AG build vehicles at plants in the United States. Industry data shows that German automakers build more vehicles in southern US states that voted for Trump in the 2016 presidential election than they ship to the United States from Germany.



The European Autos Stocks Index fell sharply after Trump's tweet and was last down 1.25%. Shares of US automakers Ford Motor Co and General Motors Co shares fell immediately after Trump's tweet but rebounded and were trading higher.



Trump has threatened duties on up to $450 billion of imports from China. Administration officials have said China should strengthen protection for US companies' intellectual property and reduce tariffs on US products.

Published in The Express Tribune, June 23^rd, 2018.

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