EU states it will react quickly if Trump hits it with car tariffs

European Union EU

U.S. President Donald Trump has pledged European Commission President Jean-Claude Juncker that he will not impose extra import tariffs on European cars for now, Juncker was quoted in a published interview as stating on Monday.

A confidential U.S. Commerce Department report submitted to Trump over the weekend is largely expected to clear the way for him to threaten tariffs of about 25 percent on imported autos and auto parts by designating the imports a national security threat.

“Trump gave me his word that there won’t be any car tariffs for the time being. I view this commitment as something you can rely on,” Juncker informed the German daily Stuttgarter Zeitung during an interview. He did not mention when Trump made the promise.

Juncker added if Trump added tariffs on European cars nonetheless, the EU would react promptly and not feel obliged to stick to its promise to purchase more soybeans and liquefied gas from the United States.

The contents of the U.S. report are anticipated to stay classified while Trump considers its recommendations, leaving the industry and major car exporters like Germany, Japan and South Korea in the dark about its consequences.

Auto industry officials stated they expect the report to suggest at least some tariffs so that the administration can use the findings of the inquiry as negotiating leverage during negotiations in 2019 with Japan and the EU.

A European Commission spokesman stated on Monday the EU wanted to improve trade relations with the United States but would react quickly if Trump decided to hit EU car imports with tariffs.

“The European Union will stick to its word as long as the U.S. does the same,” representative Margaritis Schinas stated.

Any U.S. tariffs on European cars would hit Germany’s significant automobile industry hard. The United States are Germany’s most significant single export destination second to the bloc of EU countries.

The BDI industry association called on the American administration to offer more clarity and publish the findings of the national security report soon.

“The U.S. Department of Commerce should now publish its report on automobile imports soon, so as not to further increase business uncertainty for companies,” BDI President Dieter Kempf stated on Monday.

“The import of automobiles is not a threat to U.S. national security, and U.S. President Donald Trump must abide by applicable trade law, and he should refrain from imposing any tariffs or quotas,” Kempf stated.

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