Trump's 25% tariffs on cars spark fierce backlash from Europe

U.S. President Donald Trump on Wednesday turned his earlier threat into action by signing an executive order imposing 25 percent tariffs on all imported vehicles.

The move has sparked a wave of criticism across Europe, with political leaders, experts and industry representatives calling for countermeasures. They have also urged the strengthening of trade ties with other partners to help offset the impact of rising tariffs.

Emphasizing the importance of the transatlantic partnership and free trade as pillars of prosperity for both Europe and the United States, Hildegard Mueller, president of the German Association of the Automotive Industry, described Trump's decision as "a disastrous signal for free and rules-based trade."

Mueller's remarks echo the widespread criticism and mounting tensions in transatlantic relations, further inflamed by Europe's strong backlash on Thursday.

Starting April 2, the previously low tariffs on car imports between the two allies will no longer apply, with rates set to rise sharply. The move follows Trump's claim that the European Union's trade surplus with the United States – especially in the automotive sector – is excessive.

French President Emmanuel Macron called the additional tariffs both economically and geopolitically misguided. He also questioned the timing of the move, pointing to the irony that longstanding U.S. allies were the first to be targeted. "There is a kind of paradox in seeing the United States' main allies being the first to be taxed," he said.

Jose Lopez-Tafall, director general of the Spanish Association of Automobile and Truck Manufacturers, described the tariffs as "clearly negative," warning that they pave the way for "an economic confrontation" between both sides.

"The new U.S. administration is adopting an increasingly confrontational approach towards its trading partners," said Sonali Chowdhry, a trade expert at the German Institute for Economic Research. She noted that the new auto tariffs target a highly globalized industry and are certain to disrupt complex international supply chains.

The Czech Automotive Industry Association also voiced its "serious concern" over the disruption the duties could cause to the economies of European manufacturers and suppliers, warning that the tariffs threaten their global competitiveness.

Experts widely agree that the rising tariffs will inflict economic damage on both Europe and the United States. The resulting surge in costs is expected to be passed directly on to U.S. consumers, fueling inflation, while also dampening European exports and potentially leading to job losses across the continent. Moreover, many U.S.-built vehicles depend heavily on components sourced from Europe.

"A trade war has no winners," said Dirk Jandura, president of the Federation of German Wholesale, Foreign Trade and Services. The trade body had previously projected a 2.7 percent decline in German foreign trade in 2025. "We will now revise this forecast significantly downward," Jandura added.

Even within the car market within the United States, the tariffs could add thousands of dollars to the cost of an average vehicle, contradicting Trump's campaign promise to lower consumer prices. Ferrari announced price hikes of up to 10 percent for cars sold in the U.S., and other automakers also warned they might raise prices as well. 

American industry analysts said one company likely to fare better than others is Tesla, the electric vehicle manufacturer led by Trump administration advisor Elon Musk, as Tesla makes all the cars it sells in the U.S. in the states of Texas and California.

But Musk posted on Wednesday on X that it wasn't so. "Important to note that Tesla is NOT unscathed here. The tariff impact on Tesla is still significant," he wrote.

Even so, auto industry analyst Daniel Ives of Wedbush Securities told NPR, "Tesla is the one least impacted" among U.S. carmakers.

(With input from Xinhua)

(Cover: Ursula von der Leyen, president of the European Commission, gives a statement on EU countermeasures to U.S. tariffs in Strasbourg, France, March 12, 2025. /Xinhua)