EU braces for potential US auto tariffs

• EU chief stated that EU is prepared for "every scenario" following new tariff threats from Washington.
• The diplomatic friction stems from US President Donald Trump's claim that Europe has failed to uphold the terms of a trade agreement reached in 2025.

European Commission President Ursula von der Leyen announced on Tuesday that the trade bloc is fully prepared to respond to any new economic measures following renewed threats from US President Donald Trump to increase levies on European automobiles.

Speaking to reporters in Yerevan, von der Leyen dismissed allegations from Washington that the European Union is reneging on a major trade deal struck last year.

"A deal is a deal, and we have a deal," von der Leyen stated, emphasizing that both parties are currently in the process of implementing the agreement.

She noted that while democratic procedures on both sides of the Atlantic take time, the commitment to the 2025 accord remains firm from the European perspective.

Preparedness for escalation

Despite the escalating rhetoric, von der Leyen maintained that the European Union prefers a cooperative approach but is ready to defend its economic interests.

The "every scenario" preparation mentioned by the Commission President likely includes a list of re-balancing duties on American products should the auto tariffs be enacted.

"We are both implementing this deal while respecting the different democratic procedures we have on both sides," von der Leyen added, calling for patience as the legal frameworks of the agreement are finalized.

The automotive sector remains a cornerstone of the European economy, and a 25% tariff would represent a significant escalation in the ongoing trade disputes between the two traditional allies.

25% tariff threat

The latest round of trade tensions was ignited after President Trump suggested he would move forward with hiking tariffs on European-made cars to 25 percent.

Trump has frequently criticized the trade imbalance between the US and the European Union, specifically targeting the German automotive industry.

The administration argues that the deal reached in 2025 -intended to lower barriers for American agricultural products and industrial goods- has not been implemented quickly enough by Brussels.

In response, the White House has signaled it may use Section 232 of the Trade Expansion Act, which allows for tariffs based on national security grounds, to impose the 25% duty.