Brussels/Washington, D.C. – European Commission President Ursula von der Leyen has vowed to “protect our workers” following U.S. President Donald Trump’s decision to impose a 25% tariff on all cars and light trucks imported from Europe.
The tariffs, set to take effect on April 2, are part of Trump’s broader trade policy aimed at reducing America’s reliance on foreign goods.
Trump Declares ‘Liberation Day’ for U.S. Trade
Announcing the move from the White House, Trump called the tariffs “very modest” and predicted “tremendous growth” for the U.S. auto industry. “We are going to charge countries for doing business in our country and taking our jobs,” he stated.
I deeply regret the U.S. decision to impose tariffs on EU automotive exports.
— Ursula von der Leyen (@vonderleyen) March 26, 2025
Tariffs are taxes – bad for businesses, worse for consumers, in the US and the EU.
The EU will continue to seek negotiated solutions, while safeguarding its economic interests ↓
The president also referred to April 2 as “Liberation Day,” marking the date his administration will impose additional trade restrictions on European goods.
Stock Markets and Industry Reactions
The announcement sent shockwaves through global financial markets. Stellantis, the parent company of Jeep and Chrysler, saw its stock drop by nearly 4%, while General Motors shares declined by about 3%.
Ford shares remained stable, but analysts warn that the broader auto industry could face higher costs and lower sales due to supply chain disruptions.
EU’s Response: “We Will Defend Our Workers”
In a strongly worded statement, von der Leyen criticized the U.S. decision, calling it “harmful” to both economies. “The automotive industry is a driver of innovation, competitiveness, and high-quality jobs across the Atlantic,” she said. The EU, she added, would pursue all necessary measures to protect European workers, businesses, and consumers.
Olof Gill, an EU spokesperson for economic security and trade, confirmed that Brussels is evaluating its next steps, including potential countermeasures. The EU has already threatened retaliatory tariffs on €18 billion worth of U.S. goods, set to be implemented by mid-April.
Impact on Global Trade and Jobs
Experts warn that these tariffs could destabilize global trade, affecting not only European manufacturers but also American automakers, who rely on international suppliers for components. With half of all U.S. car sales coming from imported vehicles, the price of automobiles in the U.S. is expected to rise.
Irish Finance Minister Paschal Donohoe has expressed concerns that the tariffs could lead to 80,000 job losses in Ireland in the medium term, as the country is a key player in European supply chains.
Broader Trade War Looms
Trump’s latest trade measures come amid escalating tensions with China, Canada, and Mexico. In addition to auto tariffs, his administration has imposed 20% taxes on Chinese imports, 25% on Canadian and Mexican goods, and additional duties on steel, aluminum, pharmaceuticals, and semiconductor chips.
Despite global backlash, Trump has doubled down on his protectionist policies, arguing they are necessary to rebuild American manufacturing. “I think people are going to be very surprised by how well this works,” he said, hinting at more reciprocal tariffs in the coming weeks.
With the EU preparing to strike back, experts warn that this could trigger a full-scale trade war, impacting consumers and businesses on both sides of the Atlantic.
