“If we don’t make the deal we’ll do the tariffs,” Trump said on Wednesday. “We’re trying to make a deal. They’re very tough to make a deal with, the EU.”
Earlier this week, European Commission President Jean-Claude Juncker said Trump, known for a strong protectionist approach to trade, had promised he would not impose additional import tariffs on European cars for the time being.
“We’ve studied it very carefully. We’ve seen the results. But the bottom-line result is whether or not we can make a deal with the EU that’s fair,” he said.
The U.S. and EU have been clinging to a fragile trade truce since July, when Trump and Juncker agreed to launch new trade talks. At the time, Trump promised not to impose new tariffs while the talks were ongoing.
But the trans-Atlantic tension between America and Europe was on full display at a security conference in Munich this weekend, where European diplomats gave Vice President Mike Pence a frosty welcome. German Chancellor Angela Merkel rejected the notion that European cars are a threat to U.S. national security, noting that many European models are built in America.
Trump has threatened levies of as much as 25 percent on foreign-made vehicles. Companies and governments from Europe to Asia have warned Trump that such tariffs would hurt the U.S. economy and disrupt the global auto industry.
On Monday the EU said that it will stick to its word not to impose new tariffs, as long as the U.S. does the same. The 28-nation bloc is readying retaliatory tariffs totaling 20 billion euros ($22.7 billion) of U.S. goods should Trump follow through on his threat to impose duties on EU cars and auto parts.
Negotiations for a trade agreement have not officially started and the two sides are still at odds over the scope any deal would take. While the U.S. insists agriculture should be part of the discussions, and many key U.S. lawmakers have pressed the Trump administration to hold a firm line on the issue, EU officials consider the topic off limits.