America’s trade war appears to be spiraling out of control, as President Trump has threatened to place a 20 percent tariff on all cars imported from the European Union to the United States.
In a tweet, Trump complained the European Union has placed “tariffs and trade barriers” on the U.S. and its companies for too long, and if they are “not soon broken down and removed,” a tariff on all cars built in the EU will go into effect.
The tweet comes on the same day that the European Union retaliated against the United States for imposing tariffs on aluminum and steel imports from Europe. The counter tariffs went into effect this morning and target American goods worth approximately $3.2 (€2.8) billion.
Among the items subject to a new 25 percent tariff are corn, rice, orange juice, whisky and an assortment of tobacco products including cigars and cigarettes. The tariffs are also being applied to t-shirts, steel, stainless steel, motorcycles, motor boats, sailboats and yachts.
In a statement, EU Commissioner for Trade Cecilia Malmström said “The rules of international trade, which we have developed over the years hand in hand with our American partners, cannot be violated without a reaction from our side. Our response is measured, proportionate and fully in line with WTO [World Trade Organization] rules.” Malmström added the EU “did not want to be in this position” and promised to drop the counter tariffs if the US retacts its tariffs on aluminum and steel imports.
Trump’s latest threat comes shortly after he directed Commerce Secretary Wilbur Ross to investigate whether or not automotive imports are a threat to America’s national security. The investigation is ongoing but reports have suggested imported cars could be subject to a tariff of up to 25 percent.
Besides fighting with the European Union, the United States recently announced plans to implement a 25 percent tariff on $50 (€42.9) billion worth of goods from China including automobiles. A GM spokesperson has already confirmed the Buick Envision will likely be impacted by those tariffs and reports have suggested the crossover’s price could climb by $8,000 once the tariffs go into effect on July 6th.
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