The European Union is keeping tariff countermeasures in reserve as negotiations with the United States remain unresolved following President Donald Trump’s renewed threat to raise duties on European cars and trucks to 25 per cent.
EU trade ministers and Commission officials have so far avoided immediate retaliation, preferring to keep talks open while making clear that Brussels is prepared to defend European industry if Washington moves further away from the tariff terms agreed last year.
The latest tension follows Trump’s announcement on 1 May that the United States would increase tariffs on EU automotive imports from 15 per cent to 25 per cent, citing what he described as the EU’s failure to implement the existing transatlantic trade framework. The move has added pressure to an already difficult process in Brussels, where EU governments and the European Parliament are still negotiating legislation needed to implement the European side of the arrangement.
US tariff threat puts EU car exports back at centre of trade dispute
European Trade Commissioner Maroš Šefčovič met US Trade Representative Jamieson Greer in Paris this week on the margins of G7 trade discussions. According to EU officials, the talks focused on the most urgent aspects of the agreement, including Washington’s threat to raise tariffs on EU vehicles and Brussels’ demand that the United States return to the previously agreed 15 per cent tariff ceiling.
The European Commission has said the EU remains committed to delivering its side of the joint statement, but insists that implementation must be reciprocal. Brussels is seeking to have the main elements of the trade arrangement operational by the end of July, around the anniversary of the political agreement reached in 2025.
The dispute centres on the so-called Turnberry framework, under which the United States applied a 15 per cent all-inclusive tariff rate to most EU goods, while the EU committed to eliminating tariffs on most US industrial goods and granting preferential access to certain American agricultural and seafood products.
The framework was intended to prevent a wider trade confrontation, but its implementation has proved politically difficult. In the European Parliament, lawmakers have sought stronger safeguards before approving tariff concessions to the United States. These include provisions allowing the EU to suspend its concessions if Washington fails to respect its commitments.
Bernd Lange, chair of the European Parliament’s international trade committee, said this week that progress had been made in talks with EU governments, but that there was “still some way to go”. The next trilogue negotiations between Parliament, Council and Commission are expected to take place in Strasbourg on 19 May.
EU governments have been more cautious about adding strict suspension clauses, reflecting concern that stronger language could further antagonise Washington at a sensitive moment. Several member states, particularly those with major automotive sectors, are pressing for a negotiated outcome that avoids a new escalation.
Germany would be among the most exposed economies if the United States proceeds with higher vehicle tariffs. The German automotive industry relies heavily on exports to the US market, although major European manufacturers also operate production facilities inside the United States. Industry groups have warned that higher tariffs would raise costs, disrupt supply chains and risk reducing investment on both sides of the Atlantic.
For Brussels, the immediate challenge is to maintain a united EU position. The Commission has competence over trade policy, but any response to US measures must take account of diverging national interests. Member states with large industrial exports favour firmness, while others are wary of a wider trade conflict that could affect consumers, energy costs and broader transatlantic relations.
The EU has several possible options. It could revive or expand lists of counter-tariffs targeting politically sensitive US products, as it did during earlier disputes over steel and aluminium. It could also use trade defence instruments or, in a more serious escalation, consider tools designed to respond to economic coercion. However, officials have so far signalled that such steps remain a fallback rather than the preferred course.
The current approach is therefore one of controlled pressure: negotiations continue, but countermeasures remain available. This position allows Brussels to argue that it is acting proportionately while preserving leverage if Washington proceeds with higher tariffs.
The coming weeks are likely to determine whether the EU-US tariff framework can be stabilised or whether the dispute moves into a new phase. A failure to reach agreement in the May trilogue talks would further delay EU implementation and could strengthen the argument in Washington that Brussels is not moving quickly enough.
At the same time, any unilateral increase in US tariffs would make it harder for EU lawmakers to approve concessions to American exporters. For the Commission, the priority remains to prevent a wider trade conflict while ensuring that the United States does not benefit from EU market access without respecting its own commitments.
For now, Brussels is not seeking escalation. But the message from EU institutions is that patience is conditional, and that tariff countermeasures remain on the table if negotiations fail.
