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Trade war heats up: EU prepares response for Trump's auto tariffs

Trade war heats up: EU prepares response for Trump's auto tariffs Photo: Ursula von der Leyen and Donald Trump (Getty Images)

US President Donald Trump has announced a 25% tariff on all imported cars. The EU plans to take countermeasures to protect all member states of the bloc, the European Commission President Ursula von der Leyen reports.

"I deeply regret the US decision to impose tariffs on European automotive exports," she said.

The Head of the European Commission noted that tariffs are essentially taxes. They are bad for business and even worse for consumers - both in the US and in the European Union.

"As a major trading power and a strong community of 27 Member States, we will jointly protect our workers, businesses, and consumers across our European Union," Ursula von der Leyen added.

Trump's tariffs

The new tariffs, which will particularly affect German automakers, are set to take effect on April 2. "We are going to charge countries for doing business in our country and for taking our jobs, taking our wealth, taking much of what they have taken for many years," Trump declared.

On the same day, Trump also plans to introduce a broader range of so-called reciprocal tariffs. "That's the real Liberation Day of America," he said, adding that this round would be "very lenient." The US President later threatened to implement measures "far larger than currently planned" if the EU cooperates with Canada against the US.

According to Bloomberg, the EU expects Trump to apply a double-digit tariff rate across the bloc rather than setting different rates for individual member states. EU officials, who are meeting with their US counterparts in Washington this week, see little chance of preventing the next round of tariffs

The EU will need some time to assess its response plans. However, since Trump's first term, the bloc has developed a robust toolbox it can use.