How to make new carine could affect the economy at all and why Donald tramp just now threatened to raise tariffs on imports from the European Union to 25 percent? If the announced measures are really implemented, experts estimate, the greatest consequences would undoubtedly be felt by the German automobile industry, writes Deutsche says.
Although Trump's measures formally refer to the European Union, since customs policy is the responsibility of Brussels and not the member states, they can also be interpreted as directly directed against Germany. This is what Ferdinand Dudenheffer, director of the CAR research center in Bochum, warns, pointing out that the exports of other European car manufacturers to the USA are "negligible".
The brands Audi and Porsche could "suffer" the most, while BMW and Mercedes, due to their production facilities in the United States, would be in a more favorable position. However, much is still uncertain, and Trump has been known to announce tariffs that have not been implemented in the end.
"Customs protection" through manufacturing in the USA
According to Dudenheffer, German manufacturers would not be affected to the same extent. BMW and Mercedes, thanks to their large factories in the United States, have some kind of "tariff protection", while brands without US production, such as Audi and Porsche, would be directly and severely affected. That's why Dudenheffer expects the tariff increase could speed up plans to build new manufacturing facilities in the US.
A few days ago, Trump announced on his social network Truth Social a significant increase in import duties on vehicles from the EU, arguing that the Union is not complying with the customs agreement reached last summer. However, he did not further explain or support this claim with evidence. The European Union rejected Trump's accusations.
According to that announcement, customs duties would increase from 15 to 25 percent in most cases. European-made cars and trucks produced in the United States would not be covered by the measures.
Warnings from industry and economic circles
The president of the Kiel Institute for the World Economy (IfW), Moritz Schularik, warns that the new tariffs would have a "significant" negative effect on the German economy. IfW trade expert Julian Hinz estimates that real value added could fall by around 0,3 percent. "Germany's already slow economic growth would be strongly affected," Hinz points out.
The German Automobile Industry Association (VDA) assesses Trump's move as a "new and serious strain on transatlantic relations." VDA President Hildegard Müller called for the respect of the trade agreement between the EU and the US and requested that Brussels "finally" implement the agreed obligations. Part of that customs package is currently in the European Parliament, where its adoption is subject to additional requirements.
Photo: AP Photo/Mark SchiefelbeinFriedrich Mertz's visit to Washington
The political background of the customs dispute
Trump has frequently threatened new tariffs since the start of his second term, often using them as a tool for political pressure on issues not directly related to trade. Thus, he previously tried to influence the court proceedings against former Brazilian President Jair Bolsonaro, as well as in the dispute over Greenland, but without success.
In the case of car tariffs, too, suspicions arose that it was a politically motivated move. The German federal government rejected claims that Trump's announcements were a direct reaction to Chancellor Friedrich Merz's criticism of the US course in the war against Iran. However, a senior Pentagon official told Reuters that Mertz's remarks were "inappropriate and unhelpful."
Earlier, in a conversation with the students, Mertz stated that the US clearly does not have a clear strategy in the war against Iran - an assessment shared by many experts. This, however, apparently personally angered Trump, who then verbally attacked the German chancellor on several occasions on social media. Mertz, among other things, said in the context of the US that "Iran's state leadership is humiliating an entire nation."
Calls for a tougher European response
Economist Marcel Frazer believes that German politics should speak openly and decisively more often. The president of the German Institute for Economic Research (DIW) warns that Trump is interpreting Europe's continued concessions as weakness. "The European Union and the German government must finally show determination. They must no longer allow themselves to be blackmailed, because otherwise the costs for the European economy, and especially for German exporters, will only increase," says Frazer.
He also points out that, despite the assessments of American courts that Trump's tariffs are illegal, the president is still trying to increase his popularity at home at the expense of Europe and German car manufacturers.
CDU foreign policy expert Peter Bayer thinks similarly, describing Trump's customs policy as a "political reflex and reaction born of frustration" and not as part of a coherent strategy. Still, some economists, such as Jens Zidekum, an adviser to Federal Finance Minister Lars Klingbeil, call for restraint and warn that it is not yet clear whether Trump's threat of tariffs even has a firm legal footing - or will have to be revised.
