Tariffs on European cars would hurt United States auto jobs

In response to Trump's new policy, the European Union started enforcing tariffs on American imports like bourbon, peanut butter and orange juice.

President Donald Trump has again threatened to impose tariffs on vehicles imported from the European Union.

The decision to expand the Trump administration's trade disputes to foreign vehicle manufacturers has come under fire from some in the US Congress, as well as many business lobby groups.

U.S. President Donald Trump speaks as he sits between U.S. Secretary of State Mike Pompeo and Secretary of Defense James Mattis during a cabinet meeting at the White House in Washington, U.S. June 21, 2018. Industry data shows that German automakers build more vehicles in southern US states that voted for Trump in the 2016 presidential election than they ship to the United States from Germany.

Shares in BMW, Daimler, Porsche and Volkswagen each dropped more than 1%, before regaining ground. The deadline for completing the investigation is February, 2019, but USA commerce secretary Wilbur Ross said on Thursday that the department aims to wrap up the probe much earlier, by late July or August. With Trump's latest salvo, he threatened tariffs on up to $450 billion in China's exports, out of a total of just over $500 billion in goods sold to the United States. Administration officials have said China should strengthen protections for USA companies' intellectual property, and reduce tariffs on US products.

"Of the 1.3 million German cars sold in the U.S., more than 800,000 were made on American soil".

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The Alliance of Automobile Manufacturers, representing major USA and European automakers, said "tariffs raise vehicle prices ... limit consumer choice and invite retaliatory action by our trading partners".

USA president Donald Trump threatens 20 per cent tariffs on European Union cars.

The US Commerce Department is investigating whether there should be tariffs on all imported cars and auto parts.

Cars made in America and imported to the European Union countries are now subject to import tariffs of 10 per cent, yet goods traded from Europe to the United States only face a 2.5 per cent levy.

Daimler earlier this week warned that it expects lower sales of Mercedes-Benz cars due to a tax on the import of United States vehicles into China.

Felipe Munoz, global analyst at JATO Dynamics, said: "While German-made cars accounted for 4% of Q1-18 USA sales, American-made cars made only 1.3% of German registrations in the first quarter".

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