President Trump threatened to hit the European Union with tariffs on automobiles and auto parts imports if a long-stalled trade deal could not be reached.
Trump said Wednesday that he was speaking with European Commission President Ursula von der Leyen regarding trade when he leveled the threat. “I said, ‘Look, if we don’t get something, I’m going to have to take action.’ And the action will be very high tariffs on their cars and other things that come into our country,” the president said in a CNBC interview.
Trump added that he was certain a deal could be reached. “They’re going to make a deal because they have to. They have to. They have no choice,” he said. “I would be very surprised if I had to implement the tariffs.”
The White House began preliminary trade talks with EU officials last year. Sporadic negotiations followed but never gained momentum. The talks were subsequently sidelined because the EU refused to put agriculture subsidies up for discussion and the administration’s trade team became occupied with the U.S.-Mexico-Canada Agreement and U.S.-Beijing negotiations.
Trump has periodically threatened to put 25% tariffs on automobiles and auto parts imports, which would be a heavy blow to the EU auto industry. The Commerce Department produced a study last year to justify the tariffs under Section 232 of the Trade Expansion Act, which allows the president to impose tariffs unilaterally on the basis of national security. The report was never released because talks with the EU were ongoing. A deadline to implement the tariffs reportedly passed last year, but White House officials have indicated they still think they can impose the levies.
The president told reporters at a news conference in Davos, Switzerland, Wednesday that he expected the EU negotiations would likely be rocky. “They have trade barriers where you cannot trade. They have tariffs all over the place. They make it impossible. They are frankly more difficult to do business with than China,” Trump said.
