President Donald Trump has openly dismissed an offer from the European Unio for zero tariffs on cars during an interview, stating that the proposal isn’t “good enough”.
Trump’s response came after Trade Commissioner Cecilia Malmstrom said that the EU would be “willing to bring down even our car tariffs to zero, all tariffs to zero, if the U.S. does the same.”
During an interview with Bloomberg, Trump compared the European Union to China, saying that the EU “is almost as bad as China, just smaller”.
Last month, the U.S. President met with European Commission President Jean-Claude Juncker at the White House, with the two sides agreeing not to impose new tariffs on each other right now, but negotiate in order to find a solution that would satisfy both sides.
The gap between EU’s 10 percent tariff and the US’s 2.5 percent tariff has been used by Trump as a justification of his plan to impose new duties of up to 25 percent on imported cars and parts. Bloomberg points out that Trump’s complaint ignores the existing 25 percent tariff the U.S. applies on light trucks, one of the most profitable segments in the American market.
Even if the zero-percent tariffs on U.S. auto imports go through, they’re expected to do little for Ford (GM has no presence in the region), but they will boost companies like BMW and Mercedes, who export models like the X3 from their U.S. factories to Europe.