European Union is ready with retaliation plan if US imposes car tariffs: Trade Chief says

On Wednesday, November 14, the European Union Trade Commissioner Cecilia Malmstrom said that EU is ready with its list of potential retaliation targets in case the US President Donald Trump levies auto tariffs on the bloc’s member states.

However, as per the report, Malmstrom did not specify the US products on which the EU would impose retaliatory tariffs but said the list could include “all kinds” of products.

“It could be cars, it could be agriculture, it could be industrial products - it could be everything. And we will do that, but hope we don’t have to get to that situation,” she said.

Malmstrom also said to reporters after attending a meeting with the US Trade Representative (USTR) Robert Lighthizer that the EU was willing to negotiate with a limited trade deal on industrial goods including autos that seek to bring tariff rates to zero for both the countries.

The exact scope of talks, however, cannot be defined as of now, unless the USTR completes its consultation process with Congress and the EU receives a negotiating mandate from member states, she added.

Trump administration officials, on the other hand, have reportedly made no decision on how to proceed with new recommendations from the Commerce Department or whether to impose tariffs on auto and auto parts imported from the EU.

Despite an influential automotive trade group warned on Wednesday that hike in US auto tariffs will erode the benefits of tax cuts and new US-Mexico-Canada Agreement trade deal.

“If implemented, increased auto tariffs would not only undermine the potential success of the USMCA, they would also pose a material threat to the economy and may result in the loss of as many as 700,000 jobs across the U.S.,” the Alliance of Automobile Manufacturers said in prepared testimony for a hearing on Thursday before the U.S. International Trade Commission.