Trade

Trump threatens tariff on European cars

WASHINGTON — President Donald Trump today threatened to hit imports of European automobiles with a 20 percent tariff if Brussels doesnt remove tariffs and other trade barriers.

“Based on the Tariffs and Trade Barriers long placed on the U.S. and it (sic) great companies and workers by the European Union, if these Tariffs and Barriers are not soon broken down and removed, we will be placing a 20% Tariff on all of their cars coming into the U.S. Build them here!“ Trump wrote in a tweet.

The president has become fixated on automotive trade, viewing it as a major irritant between the U.S. and its trading partners in Asia and Europe.

The threat comes after Trump directed the Commerce Department to launch an investigation into whether imports of foreign autos were a risk to U.S. national security and should be subject to tariffs or other trade restrictions.

Trumps tweet also comes the same day the EU imposed tariffs on U.S. products, ranging from Kentucky Bourbon to Harley Davidson Motorcycles, in retaliation against U.S. tariffs on imports of European steel and aluminum.

The U.S. already taxes imports of European cars at a rate of 2.5 percent. Trump has often complained about the 10 percent tariff the EU imposes on imports of U.S. cars.

The German auto industry supports talks to reduce auto tariffs between the U.S. and EU, but only as part of a larger trade negotiation.

“The basis for future agreements between the EU and the U.S. must be the rules of the WTO,” the German auto industy group VDA said in a statement Thursday. “There is no proposal for unilateral concessions or the mutual dismantling of exclusive car duties.”

The statement followed a Wall Street Journal report on Wednesday that U.S. Ambassador to Germany Richard Grenell was bringing a proposal to Washington from German automakers to eliminate auto tariffs across the Atlantic.

Asked last week how she would react if Trump went through with his plan to impose tariffs on EU car exports, German Chancellor Angela Merkel said in an interview: “First we are trying to see if we can prevent that from happening — but I cant predict this, so I dont want to raise any false hopes. And then, the European Union will hopefully act as united again as it has done now.”

Merkel also cited to the EUs retaliatory tariffs on Bourbon and Harley Davidsons and said: “We dont let ourselves be taken advantage of again and again.”

Another one of Trumps Friday morning tweets was directed at Mexico, and he took on a much friendlier tone than usual when discussing the NAFTA partners trade and immigration policies. Trump praised Mexicos approach to combating illegal immigration, and even said that Mexicos reliance on the U.S. as an export market was acceptable.

“80% of Mexicos Exports come to the United States. They totally rely on us, which is fine with me. They do have, though, very strong Immigration Laws,” Trump posted on Twitter, a day after a vote on a compromise immigration measure was postponed in the House. “The U.S. has pathetically weak and ineffective Immigration Laws that the Democrats refuse to help us fix. Will speak to Mexico!”

Jakob Hanke and Sabrina Rodriguez contributed to this report.

Read this next: Seehofer: Migration ultimatum for Merkel is nonsense

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