German Chancellor Friedrich Merz has warned that Donald Trump’s escalating trade tariffs are placing significant strain on Germany’s economy.
Speaking during an interview on Fox News’ Special Report during a visit to the United States, Merz said free trade and open markets remain essential to shared prosperity and should not be undermined by protectionist policies.
The Chancellor was asked for his reaction to Elon Musk’s recent claim on X (formerly Twitter) that Trump’s tariff strategy could trigger a U.S. recession in the second half of the year.
Musk, who has been engaged in an increasingly public feud with the former president, described the economic measures as damaging and shortsighted. While Merz avoided commenting directly on Musk’s remarks, he expressed concern about the direction of U.S. trade policy under Trump, stating the tariffs are “really threatening our economy.”
Merz emphasised Germany’s commitment to a rules-based global trading system, calling for a rollback of duties that he said undermine long-standing economic ties between the U.S. and Europe.
“Our conviction is that free trade, open markets are the best thing for the mutual wealth of our countries and of our continent,” he said. “We are part of Europe, so we are in the discussion, but I have my view on that.”
The tensions follow Trump’s imposition of a 25% tariff on imported vehicles and parts, coupled with a temporary 10% levy on all other goods — a reduction from the previous 20%.
Trump has defended the tariffs as necessary for ensuring that U.S. industries are treated fairly, arguing that America must push for open markets only when trading partners reciprocate.
In return, the European Union imposes a 10% tariff on most U.S. car imports. Merz acknowledged this but reiterated his belief that the overall tariff regime should be revisited. “We should bring them down,” he said.
While Musk has linked Trump’s tariffs to potential economic collapse, the broader business community in Germany is quietly echoing concerns that the measures could hurt manufacturing exports and disrupt global supply chains.
Musk’s post came as part of a wider tirade against Trump, in which the Tesla CEO also suggested Trump was hiding information related to the Jeffrey Epstein investigation — a claim that has triggered widespread political backlash in Washington.
Despite the ongoing friction, Merz said discussions on tariffs remain a matter for the European Commission and the U.S. government, adding that Germany would remain engaged through diplomatic channels.
His visit comes at a time when global inflation, shifting supply routes, and geopolitical uncertainty are reshaping the terms of trade between the world’s major economies.
Merz’s comments reflect growing unease within the EU about the future of transatlantic economic cooperation, especially if Trump returns to the White House.
European leaders are expected to push back more forcefully against the tariffs in upcoming talks as they seek to prevent further economic fallout.
