U.S. Trade Representative Jamieson Greer told European Union and German trade officials over the weekend that the United States will advance President Trump’s proposal to increase tariffs on EU car imports to 25%, Greer said in a Monday interview on CNBC.
"I was in contact with both European and German trade officials this weekend to help them understand why this was happening and remind them of all the conversations we’ve had about their compliance," Greer told CNBC. He added that he would continue those discussions but that "the president’s moving forward with this action."
When asked whether the tariff should be viewed as a temporary negotiating lever or a permanent shift in trade policy, Greer said: "It’s one part of the deal."
As of Monday at 1 p.m. ET, the new 25% tariff had not been officially adopted.
President Trump announced on Friday that he would raise tariffs on passenger cars from the European Union to 25% next week, up from a previously agreed level of 15%, saying the EU had not complied with its trade deal with Washington.
The European Commission rejected the assertion that Brussels had failed to comply with last summer’s agreement and said it would keep its options open to protect EU interests should Washington breach the terms of that deal.
The move to escalate duties came amid widening friction between the United States and the EU tied to the war in Iran and European countries’ refusal to send naval forces to keep the Strait of Hormuz open. Separately, the White House said on Friday it plans to remove 5,000 U.S. troops from Germany after German Chancellor Friedrich Merz said the U.S. was being "humiliated" by Iran in talks to end the conflict in the Middle East.
The administration last year applied a 25% tariff on global automotive imports under a national security trade law, then negotiated a separate agreement with the EU in August that reduced those duties to a net 15%, inclusive of prior levies.
Market reaction was swift. Shares in German automakers declined on Monday following the announcement of the tariff increase. The pan-European automobiles and parts index fell 2.3% as of 10:46 GMT, while individual stocks including Porsche, BMW, Mercedes-Benz and Volkswagen each dropped between 2% and 3%.
The public comments from the U.S. trade representative, the European Commission’s rejection of non-compliance claims, the related geopolitical tensions and the markets’ immediate reaction together underscore the multidimensional nature of the dispute. The situation remains fluid: the administration has signaled intent to move forward, but the new duties had not been formally enacted as of the stated time.