Trump Administration Suggests 10% Tariff on European Car Imports | Carscoops

      The Trump administration is now pointing fingers at Europe, India, and Brazil amidst a new escalation in the trade war.

      Recently, the White House indicated that new tariffs might be imposed on India and the European Union. It was suggested that a 10% tariff could be applied to automotive imports from Europe, while Indian motorcycles might face a 100% tariff to align with those levied on American bikes.

      After targeting Canada, China, and Mexico, President Trump is now focusing on the European Union and its automobile manufacturers. As part of this initiative, the White House has introduced a plan for “Reciprocal Trade and Tariffs,” which is set to affect both allies and adversaries.

      Though the plan is somewhat vague, it aims to address “non-reciprocal trading arrangements” with trading partners by establishing an equivalent reciprocal tariff for each foreign partner. Essentially, it seeks to penalize countries that impose tariffs or “unfair, discriminatory, or extraterritorial taxes” on American goods and businesses.

      The plan requires an investigation and report prior to any implementation, yet a “fact sheet” released by the Trump administration suggests potential targets. Notably, it points out that the European Union imposes a 10% tariff on imported cars, while the United States has a lower tariff of 2.5%. This implies that the White House may consider a 10% tariff on automotive imports from Europe.

      Such a measure would affect several automakers; however, BMW and Mercedes already have a substantial presence in the U.S. due to their facilities in Spartanburg, South Carolina, and Tuscaloosa, Alabama, respectively. Additionally, Volkswagen operates a plant in Chattanooga, Tennessee.

      In regard to India and the automotive sector, the White House emphasized India's 100% tariff on American motorcycles, contrasting sharply with the United States' 2.4% tariff on motorcycles imported from India.

      The Trump administration also pointed out the disparity in tariffs on ethanol imports—while the U.S. has a 2.5% tariff, Brazil imposes an 18% tariff. According to the White House, this led to the U.S. importing over $200 million worth of ethanol from Brazil, whereas only $52 million worth was exported from the U.S. to Brazil.