United States’ President Donald J. Trump has threatened to get his country rid of German luxury cars for good, according to reports.
The media outlet claimed that on French President Emmanuel Macron’s visit to the US, Trump told him that he was going to push German car manufacturers out of the United States. However, the French administration has declined the request for a comment on the news.
According to several anonymous European and US diplomats, this was actually confirmed but they did not get any direct quotes. The US Embassy was asked for a comment and their spokesperson in Berlin told to transfer the question to Washington for a comment.
Trump is using the same ‘National Security’ excuse that he made while imposing the steel and aluminium tax. Just last week, the White House opened an investigation regarding the car imports which could end up imposing a hefty 25 percent tax on all the luxury cars.
This move is enough to demolish the exports by the German car manufacturers, which are in fact in control the 9/10 portion of the United States luxury car market. BMW owns Rolls-Royce, while Daimler has Mercedes-Benz and Volkswagen controls Bentley, Bugatti, Porsche and Audi. All of these car-manufacturers were reached for a comment, the request which they declined. These companies also faced a blow in the stock market after the news broke out.
This is not out of the blue, Trump had announced his plans to put tariffs on German cars up to 35 percent in an interview with a German media outlet. He admired the German-manufactured cars but claimed that the United States was being treated unfairly by them as well. Germany’s auto industry association said that its members exported 657K vehicles to North America in 2017, with total exports of vehicle components, cars, engines, as well as second-hand vehicles totalling 31.2 billion euros in 2016.
How the implementation affects the trade between the EU and the United States is yet to be seen.