European Union threatens $294B in retaliatory tariffs if Trump imposes foreign auto levies

Fredrick Soto
July 3, 2018

The European Commission, the EU executive that handles trade for the bloc, said on Monday it was trying to convince its U.S. counterparts that imposing such tariffs would be a mistake.

Trump's threat was the latest salvo in an escalating trade war that saw the EU slap duties on US-made jeans and Harley Davidson motorcycles in a tit-for-tat response to USA tariffs on European steel and aluminium exports.

The European Union is reportedly preparing to slap tariffs on up to $300 billion of US products, if the White House goes ahead with its threatened tariffs on auto imports from the EU.

"It's awful what they do to us", Trump said in an interview with Fox News.

The company added: "It would be highly impractical to take parts for commercial vehicles created to safely transport the average US family in comfort and meet strict USA environmental and safety requirements and incorporate them in a military vehicle".

"The European Union is possibly as bad as China, just smaller", he told Fox News in an interview, adding that it was "terrible what they do to us" and then mentioning the "car situation".

Toyota has sent a letter to United States Secretary of Commerce Wilbur Ross urging the Trump administration to reconsider a round of proposed tariffs on foreign-made automotive parts. In all fairness, they have their farmers, so they want to protect their farmers. "But we don't protect ours and they protect theirs", he said.

The submission comes as the Commerce Department investigates automobile imports to the U.S.

So far, the EU has only imposed duties on $3.2 billion of US products such as whiskey and peanut butter, as retaliation for President Trump's tariffs on imported European steel and aluminum. The U.S. has higher tariffs on trucks and other products, she said.

The commission said "up to $294 billion of U.S. exports. could be subject to countermeasures across sectors of the USA economy", which was equivalent to a staggering 19 percent of total United States exports in 2017.

In recent months, Trump has sparked a global-trade conflict by placing or threatening punitive tariffs on hundreds of billions of dollars' worth of goods from China, Mexico, Canada, and the European Union.

In its submission, the European Union said EU companies make close to 2.9 million cars in the United States, supporting 120,000 jobs - or 420,000 if cars dealerships and auto parts retailers are included.

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