Europa Posted on 2025-08-02 12:59:00

European car industry "under pressure" - Tariffs on vehicles will remain at 25%, despite US-EU pact

From Kristi Ceta

European car industry "under pressure" - Tariffs on vehicles will

The United States continues to impose 25% tariffs on European vehicles, despite a pact with the EU for 15% duties. Also, uncertainties remain for many sectors such as metals and digital networks, where the parties have not yet reached a final agreement.

US President Donald Trump appears unwilling to ease the pressure on European carmakers. The US executive order on reciprocal tariffs did not apply the 15% measures agreed between the parties to US auto imports. Since April 2, EU cars have been hit with 25% tariffs under the American Trade Expansion Act, which allows the US president to restrict imports of goods that threaten national security.

The deal between President Ursula von der Leyen and Trump was intended to apply 15% tariffs to EU cars and exempt some strategic products such as aircraft from the tariffs, but none of these are mentioned in the executive order. The order imposes a general tariff of 15% on goods from the bloc and will take effect on August 8. Any attempt to avoid these tariffs will be punished with a 40% tax.

The Commission and the US administration are struggling to agree on a common text and have so far promoted different narratives for the deal. There is still uncertainty about the fate of steel and aluminium, currently hit by a 50% US tariff. According to the Commission, the metals are expected to be part of the lower quotas soon. Negotiations on some exemptions are also ongoing, while the EU spirits industry is increasing pressure.

The United States also claims that the EU has committed not to levy tariffs on the use of telecommunications networks in a future Digital Networks Act, which is currently being debated between European companies and US tech giants in Brussels. Meanwhile, the Commission has stressed that a document published in February 2024 assessed that imposing a tax on digital networks is “not a sustainable solution and would not apply only to US companies”.

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