After court blocks 10% global tariff, Trump threatens 25% EU auto tariffs

Cars are the part of a trade fight people actually feel. They show up in sticker prices, dealer inventories, shipping volumes, and eventually in repair costs too. That is why this latest turn matters. Donald Trump threatened to raise tariffs on European cars and trucks to 25%, even as a federal trade court knocked out his separate 10% global tariff plan and exposed how shaky the legal ground under parts of his trade agenda still is. ### What did Trump actually threaten? On May 1, Trump said he wanted to raise tariffs on EU cars and trucks from 15% to 25%, arguing that the European Union was not honoring a prior trade deal with Washington. The White House framed the move as pressure on Brussels, not a same-day policy change, and by May 9 the message had softened into something closer to a warning than an immediate order. (time.com) ### Why 15% in the first place? Because the U.S. and EU had already cut a deal last year. That agreement set tariffs on European autos at 15% instead of the steeper 25% level Trump had threatened before, and it was supposed to stabilize a big irritant in transatlantic trade. So this week’s 25% talk was not a brand-new tariff regime — it was a threat to tear up the truce and go back to the harsher number. (cnbc.com) ### What happened in court? A three-judge panel on the U.S. Court of International Trade ruled 2-1 on May 7 that Trump’s 10% global tariffs were unlawful. Those tariffs had been imposed in February as a backup after the Supreme Court had already struck down an earlier round of broader tariffs. The Justice Department appealed quickly, but the immediate point is simple — one of Trump’s main fallback tariff tools just got rejected too. (forbes.com) ### Why does that court loss matter for the car threat? Because it changes the leverage. If one tariff tool keeps getting thrown out, the administration has more reason to lean on narrower authorities that may be harder to challenge. The auto threat appears tied to Section 232 national-security authority, which is legally different from the global tariff route the court just blocked. Basically, even if one lane closes, the White House is signaling it still has another lane for autos. (time.com) ### Who gets hit first if 25% happens? European brands with a lot of imported U.S. sales would feel it fastest — think BMW, Mercedes-Benz, and Volkswagen. But the pain would not stop there. U.S. ports that handle vehicle imports would lose volume, dealers could face tighter supply, and buyers shopping luxury or specialty models would likely see higher prices. That is why this is not just a Europe story — it runs straight into U.S. consumers and logistics. (cbtnews.com) ### Are imports already falling? Yes — and that is part of the tension here. U.S. motor vehicle imports were down 16.46% last year and down 23.11% so far this year in the Forbes tally. So Trump is threatening a sharper tariff increase at a moment when the flow of imported vehicles is already weakening. That makes the move look less like a response to a surge and more like a pressure tactic inside a broader political and legal fight. (cbtnews.com) ### So is a 25% EU auto tariff happening now? Not yet. The real news is the threat, the legal backdrop, and the revived uncertainty. Trump showed he is still willing to use tariff escalation against Europe, but he also stopped short of flipping the switch immediately. That leaves automakers, ports, and buyers in the worst kind of middle ground — no final policy, but plenty of reason to prepare for one. (forbes.com) ### Bottom line The court just told Trump one big tariff workaround was illegal. Instead of backing away from tariffs, he reminded everyone that autos may be the next pressure point. That is the whole story in one line — the legal map got narrower, but the tariff risk did not. (forbes.com)