AI News Hub Logo

AI News Hub

Trump says he's raising tariffs on European cars to 25%

Business Insider
Ben Shimkus

President Donald Trump wrote that he will increase the tariff on imported European cars to 25%. Chris Jackson/Getty Images In a Truth Social post, the president said tariffs on EU-built cars will rise to 25% next week. Negotiators had pushed the tariff rate down to 15% — but Trump said members were "not complying." Trump also boasted about recent investments in US automaking plants. President Donald Trump says he isn't done with new tariffs. On Friday, the president said he plans to raise tariffs on cars and trucks imported from the European Union to 25% next week. In a post on Truth Social, Trump said the EU is "not complying with our fully agreed to Trade Deal," and added that automakers could avoid the tariffs if they produce vehicles at plants in the United States. The move would raise tariffs from levels outlined in a 2025 US-EU trade framework, agreed to in July 2025, which set a 15% ceiling on most goods. That agreement has been the subject of ongoing disputes over how its terms are implemented. Trump didn't clarify what tariff authority he plans to use for the higher rates. Volkswagen told Business Insider it would review details of the announcement once they are available. Representatives for the other major EU automakers — BMW, Mercedes-Benz, and Fiat's parent company Stellantis — didn't immediately respond to a request for comment from Business Insider. Jennifer Safavian, the president and CEO of Autos Drive America, a trade group representing automakers, said an increased tariff "would threaten the progress" recently made between the EU and the US. "We urge the administration and the EU to uphold the agreement made last year and work together to find a swift resolution," she added. The auto industry has been a central focus of Trump's trade agenda. He has used Section 232 of the Trade Expansion Act — a national security provision — to impose tariffs on imported vehicles and parts. Those potential tariffs are separate from the IEEPA duties Trump imposed during "Liberation Day," which were struck down by the Supreme Court earlier this year. Automakers have said they paid billions of dollars on those tariffs, too, before the Supreme Court stepped in. General Motors said it expects a roughly $500 million refund following the ruling, while Ford booked a $1.3 billion one-time tariff-related benefit. In the post on Friday, Trump said that several automotive plants are "currently under construction" and that the factories would be "staffed with American workers." Automakers have been spending billions of dollars on new US facilities and reworking existing plants to build more of their top-selling vehicles domestically. Volkswagen, for example, is ending production of the electric ID.4 at its Tennessee plant and shifting the factory to build the higher-selling Atlas SUV. GM also recently confirmed to Business Insider a $340 million investment in two US propulsion plants to expand production of gas-powered trucks, SUVs, and the Chevrolet Corvette. The company said it does not expect to increase hiring as a result of the investment. Read the original article on Business Insider