European carmakers warn against 'harmful' EU-US trade war
Europe’s prominent carmakers have called on the EU to help prevent a “trade conflict” with the US by negotiating a “grand bargain,” days before Donald Trump officially assumes the presidency.
"If we end up in a trade conflict, our clear assessment is that would be significantly economically harmful to the EU and to the European auto industry," Ola Kallenius, Mercedes CEO and new president of the European Automobile Manufacturers' Association (ACEA), said on Thursday.
"The more free and open the markets are, the better for the European auto industry," Kallenius told reporters, pointing to trade with the United States and China.
In a letter sent to the European Commission and the European Parliament, the giant carmakers of Europe deemed it necessary to maintain economic relations with China and the US, calling it “vital for the prosperity of the European economy.”
More than a fifth of EU car exports go to the US. Besides, some EU carmakers are partly or fully Chinese-owned.
The US president-elect has repeatedly threatened to increase tariffs on European goods, as well as products made by China.
Trump has already pledged a blanket tariff of up to 20 percent on all US imports during the presidential campaign, weighing on the European automotive industry at a time when it is struggling with the costly transition to electric vehicles and the rise of Chinese competition.
Trump has attacked Germany for exporting 738,436 vehicles to the US in 2022, compared to 271,478 vehicles imported to the EU from the US within the same period.
During Trump’s first term, both sides imposed tariffs on trade worth hundreds of millions of dollars.
Despite strong lobbying by member states to avoid a trade war, Brussels believes retaliatory measures against the US president-elect may be unavoidable.
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