Germany slams Trump’s 25% auto tariffs as bad news for U.S., EU and global trade

Germany’s economy minister and auto industry lambasted U.S. President Donald Trump’s plans to impose sweeping 25% tariffs on U.S. car imports, saying the move sends a “fatal signal” to free and rules-based trade.

Trump on Wednesday said he would implement tariffs on all vehicles and foreign-made auto parts imported into the U.S., as part of measures set to come into force from April 2.

The duties, which coincide with an even broader push on levies starting next week, represent a major escalation in an already brewing global trade war.

German Economy Minister Robert Habeck called for the European Union to provide a “decisive response” to Trump’s latest tariff announcement, saying the levies “ultimately harm the US and the EU, and global trade as a whole.”

“The announcement of high tariffs on cars and car parts is bad news for German carmakers, for the German economy, for the EU, but also for the US,” Habeck said Thursday in a Google-translated statement.

“It is now crucial that the EU delivers a decisive response to the tariffs – it must be clear that we will not back down in the face of the US . Strength and self-confidence are required,” he added.

European auto stocks traded sharply lower on Thursday, tracking auto losses in Asia overnight.

French car parts supplier Valeo traded down 5.2% at around midday London time (8 a.m. ET), while Milan-listed Stellantis and Germany’s Porsche fell over 4%.

“The announced additional US tariffs of 25% on all passenger cars and light commercial vehicles not manufactured in the US send a fatal signal for free, rules-based trade,” Hildegard Müller, president of the German Association of the Automotive Industry (VDA), said in a statement out Wednesday.

“The tariffs, which are scheduled to take effect on April 2, will place a significant burden on both companies and the automotive industry’s closely interwoven global supply chains—with negative consequences, especially for consumers—including in North America,” Müller said.

The VDA’s Müller underlined the economic importance of free and fair trade to both sides of the transatlantic partnership and called for immediate negotiations between the U.S. and EU on a bilateral agreement.

“The risk of a global trade conflict – with negative impacts on the global economy and growth, prosperity, jobs, and consumer prices – is high on all sides,” Müller said.