Trump threatens to tariff European autos if EU trade talks fail

President Trump on Tuesday renewed his threat to impose tariffs on European automobiles and parts if the U.S. and European Union fail to reach a trade agreement.

“We expect to be able to make a deal with Europe and if they don’t make a deal, we’ll certainly give that very strong consideration,” Trump told reporters in Davos, Switzerland, at the World Economic Forum. “If we’re unable to make a deal we will have to do something because we’ve been treated very badly as a country for many, many years on trade.”

Trump did not specify when he would impose the tariffs, adding that “they know they have to do something, and if they’re fair, we’re not going to have a problem.”

Trump first proposed imposing tariffs on foreign vehicles in 2018, but did not do so by the legal deadline to levy the import taxes. The president has long accused the EU of hindering American farmers and automakers by abusing the U.S. in foreign trade, though most experts contest his characterization of their relationship.

Trump is seeking a commitment from the EU to boost purchases of American goods, particularly agricultural products, to narrow the trade deficit between the two countries. Without a deal, Trump could follow through with auto tariffs that could crush the European economy.

Trade tensions have steadily risen between the U.S. and EU since Trump’s election, and peaked in late 2019 after the White House imposed tariffs on a slew of popular European exports. 

Trump levied tariffs in October after a World Trade Organization (WTO) arbiter cleared the U.S. to impose up to $7.5 billion in tariffs on European goods in response to a 2004 dispute over aircraft subsidies. The EU retaliated with its own tariffs on U.S. goods.