U.S. President Donald Trump’s announcement of sharply increased tariffs on automobiles and trucks imported from the European Union could cost Germany up to €15 billion in lost production, according to economists.
Significant Economic Impact Expected
“The effects will be substantial,” said Moritz Schularick, director of the Kiel Institute for the World Economy (IfW), in a Reuters interview. The institute notes that U.S. tariffs already imposed on German exports have already cost the country several billion euros.
Tariff Hike Announced, Disputed
On Friday, May 1, 2026, Trump announced plans to raise tariffs on EU-made cars from 15% to 25% the following week. He cited alleged non-compliance by European leaders with an existing trade agreement between the EU and Washington.
In response, the European Commission rejected the claim, stating that the EU is fully honoring its commitments under the Joint Declaration—following standard legislative procedures and keeping the U.S. government fully informed throughout the process.
Broad Regional Concerns
Countries with major automotive industries—including Italy, Slovakia, and Sweden—could face similar challenges if the tariff increase moves forward.
Call for Calm and Caution
Jens Südekum, chief economic advisor to Germany’s Federal Ministry of Finance, urged patience toward the U.S. president. “For now, the EU should simply wait and see what happens. It’s well known that Trump often rushes to issue grand tariff threats—and just as quickly suspends or withdraws them.”