Trump threatens 25% EU car tariffs

Cars are back at the center of the U.S.-Europe trade fight. Donald Trump said on Friday, May 1, that he wants to raise tariffs on automobiles and auto parts from the European Union to 25%. That matters because cars are one of the most politically sensitive pieces of transatlantic trade — big employers, big exporters, and easy symbols in a trade showdown. The gap here is that Washington and Brussels already had a deal that was supposed to calm this down. Now Trump is threatening to blow through it. ### What did Trump actually threaten? He said he would increase the tariff on EU cars and trucks from 15% to 25%, and he tied the threat to his claim that the EU is not complying with the trade deal the two sides struck last summer at Turnberry in Scotland. The threat covers too. ### What was the Turnberry deal? On July 27, 2025, Trump and European Commission President Ursula von der Leyen announced a broader tariffs-and-trade deal. One of the key pieces was that the U.S. would apply a 15% tariff to EU imports, with auto tariffs reduced from a higher level as part of the package. Brussels sold that as a way to stabilize trade and avoid a bigger tariff war. ### Why does 25% hit so hard? Because 25% is not a nuisance tax. It is the kind of duty that can wipe out margins, force price hikes, or push companies to reshuffle production. European brands ship a lot of higher-priced vehicles to the U.S., but the pain would not stop. That threat can freeze investment decisions. ### Is Brussels treating this like a bluff? Not really. The European Commission said it would “keep our options open,” which is diplomatic language for: we are not conceding, and retaliation is still on the table. The EU position is that it is implementing the Turnberry deal at once — avoid escalation, but prepare for it. ### What could the EU do back? The bloc has already been building a retaliation toolkit for earlier Trump tariffs. Brussels has consulted on countermeasures, prepared WTO action, and weighed tariffs on a wide range of U.S. goods if talks fail. So this is not starting from zero. The machinery for a response already exists. ### Why are cars such a flashpoint? Because autos sit right where politics and economics overlap. They are visible, union-heavy, and tied to national industrial pride. The EU also has a 10% most-favored-nation tariff on cars, while the U.S. has long kept a 25% tariff on pickup trucks — the famous “chicken tax.” So both sides already have a history of protecting this sector. ### What changed from a month ago? A month ago, the mood was moving toward a truce. Trump had eased some other tariff pressures, and people in Brussels thought the broader U.S.-EU deal might hold. This new threat reverses that mood. Basically, the old uncertainty is back, and carmakers are once again stuck planning around presidential posts instead of settled trade rules. ### Bottom line This is not just about imported BMWs getting pricier. It is about whether the U.S. and EU still have a functioning trade ceasefire. If Trump follows through, the likely result is higher costs, delayed investment, and another round of retaliatory threats neither side really controls once they start.