Panic is setting in across the EU as officials scramble to respond to U.S. President Donald Trump’s latest tariff threats. Trump has announced a 25% tariff on foreign steel and aluminum, along with additional trade penalties targeting several nations.
According to the Polish newspaper Rzeczpospolita, Brussels is in damage-control mode, urgently preparing a response in case Trump follows through. Poland, currently holding the EU presidency, convened an emergency ministerial teleconference to discuss the looming trade war. While no countermeasures have been enacted yet, one EU official stressed the need for Europe to stand united against Washington’s aggressive stance.
If imposed, these tariffs would deal a heavy blow to the EU, which exports €6 billion worth of steel and aluminum to the U.S. annually. But the real battleground? Cars. The EU slaps a 10% tariff on U.S.-made vehicles, while American duties on European cars sit at just 2.5%—an imbalance Trump has long criticized. Brussels argues it can’t lower U.S. tariffs without also reducing them for other WTO members, including China, with whom it’s already locked in a trade dispute over electric vehicle subsidies.
The stakes are enormous. The EU’s auto sector sends €65 billion worth of vehicles to the U.S. each year, with German giants Volkswagen, BMW, and Mercedes producing 74% of the 920,000 European cars sold in America. With sluggish sales in China and a downturn at home, losing the U.S. market could be disastrous for Germany’s auto industry. Behind the scenes, intense lobbying is underway to prevent a full-blown trade war.
Sigrid de Vries, secretary general of the EU’s automotive industry federation, urged restraint: “Instead of escalating tensions, we should work toward a broader trade agreement.” Meanwhile, EU trade commissioner Maros Sefcovic insisted tariffs would be counterproductive, hurting businesses, consumers, and global trade.
Brussels has floated increasing purchases of American liquefied natural gas (LNG) and weapons to ease tensions, but it’s also preparing for a fight. If Trump pushes forward, the EU is ready with retaliatory tariffs—just as it did during his previous administration, targeting goods from Trump-supporting states, such as Kentucky bourbon, Wisconsin-made Harley-Davidsons, and Florida orange juice.
This time, the EU has even more tools at its disposal. The Anti-Coercion Instrument (ACI), introduced in December 2023, gives Brussels new leverage, allowing it to hit back with trade restrictions, intellectual property barriers, and investment limits. Meanwhile, the Digital Markets Act (DMA) and Digital Services Act (DSA) could be weaponized against American tech giants like Google, Amazon, and Meta—companies closely tied to Trump’s economic interests.
But officials worry that tit-for-tat tariffs could quickly spiral out of control, dragging both economies into chaos. With tensions rising, Europe faces a tough choice: stand firm and risk escalation or seek a deal before the situation spins out of hand.
