New auto tariffs set to take effect next week as tensions rise over compliance with U.S.–EU trade agreement.
By yourNEWS Media Newsroom
President Donald Trump said Friday that the United States will impose a 25 percent tariff on cars and trucks imported from the European Union beginning next week, citing what he described as Europe’s failure to uphold a previously negotiated trade agreement.
In a statement posted to Truth Social, Trump said the European Union “is not complying” with the terms of the agreement reached last year, signaling a significant escalation in trade tensions between Washington and Brussels.
The decision centers on the Turnberry Agreement, a framework finalized in July 2025 that capped most U.S. tariffs on European goods at 15 percent. In return, the EU committed to reducing duties on American industrial exports and expanding access for U.S. agricultural products. European officials accepted the deal at the time to avoid steeper tariff threats and to maintain broader cooperation with the United States.
Implementation of the agreement has been uneven. The European Parliament delayed ratification on two occasions, including after a legal ruling that curtailed U.S. tariff authority under the International Emergency Economic Powers Act. Lawmakers ultimately approved enabling legislation in late March, but attached provisions tying tariff reductions to continued U.S. compliance and setting a termination date for 2028.
Ongoing disputes over metal tariffs have also strained the agreement. The United States expanded a 50 percent tariff on steel and aluminum products last year to include a wide range of goods incorporating those materials. European officials argued the policy conflicted with the broader trade framework, and concerns persisted even after Washington revised how those duties are calculated.
Trump said the new tariffs would not apply to vehicles manufactured in U.S. facilities, stating that companies producing domestically would be exempt. That distinction is expected to affect European automakers differently. Firms such as Volkswagen, Mercedes-Benz, and BMW, which operate assembly plants in the United States, may avoid the full impact. Others, including Stellantis, which imports several brands from Europe, could face more direct exposure.
The tariff announcement comes amid broader economic uncertainty tied to the ongoing conflict involving Iran, which has contributed to rising energy prices and disruptions in global supply chains. Trade between the United States and the European Union remains extensive, with goods and services exchanges totaling roughly $2 trillion in 2024.
European officials have previously warned that any increase beyond agreed tariff limits could trigger retaliatory measures. The European Commission has stated that products from the bloc should continue to receive treatment consistent with the agreed ceiling under the existing deal.
With negotiations still ongoing and key provisions unresolved, the new tariffs introduce additional pressure into an already fragile transatlantic trade relationship.
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