US -EU – EU: Seven questions and answers, winners and losers

There may be a relative relief in the European automaker after the announcement of the agreement USAEUfrom the point that there was finally one…. Agreement (and thus removing uncertainty at present), but everything else … The “real economy” of the EU has quiet.

It is recalled that the US agreement with the US will impose a 15% duty on car imports from the European Union. The EU has pledged to eliminate obstacles for importing US vehicles. This means that vehicles will be treated by the US in the same way as most other goods.

US President Donald Trump stressed that he is seeing the biggest opportunities for additional US exports to US cars.

“We have some vehicles that are very well sold and we are truly successful with trucks and SUVs,” Trump said on Sunday night, shortly after the US and EU agreement on tariff agreement.

What does the agreement on German automobile companies mean, but also on new investments and facilities in the US and the EU: Handelsblatt answers the most important questions.

1. What did the US and the EU agree with?

Since April, EU manufacturers have to pay an American import duty of 25% in addition to an existing 2.5%.

In addition, since the beginning of May, the US has also imposed a 25% duty on car spare parts.

However, companies were able to claim compensation for part of these expenses, provided that the final assembly was carried out in the US.

In the future, The US will impose a 15% basic duty on most EU imports, including cars.

Brussels, in turn, They want to reduce duties in US cars. How much was initially unclear to date (28.7.25). According to reports, The duties will be reduced from current 10% to 2.5% or even completely removed.

Trump said that 50% “global” duties will continue to apply to steel and aluminum.

Von der Layen, on the other hand, said the punitive duties on steel and aluminum would “be restricted and replaced by a quota system”.

These three metals are important materials in car production.

2. What are the reactions?

Chancellor Friedrich Merz (CDU) welcomed the deal. It was possible to “prevent a trade conflict that would hit the exporting oriented German economy,” Merz said on Sunday, July 27, 2025.

“This is especially true for the automotive industry, where current duties will be reduced by almost half from 27.5% to 15%.”

Hildegard Müller, president of the German Car Union (VDA), also expressed its original relief reached.

However, the decisive factors will be the specified form that will receive the agreement and the how reliable will be.

“The US duty of 15%, including car products, will cost German car companies billions a year and burden them in the midst of transformation.”said Müller.

Responding to a Handelsblatt question that night, Mercedes-Benz said: “We welcome the agreement between the EU and the US. The reduction in import duties brings to the German automotive industry the necessary relief compared to the current status quo. “

However, the company remains committed to a liberal trade regime. “This includes the principle that all participants enjoy equal conditions.”

The duties cost the VW subsidiary, Audi, 600 million euros in the first half of the year.

Audi has not yet passed on customers’ duties, said Financial Director Jurgen Rittersberger today (28.7.25), presenting her financial data.

His company currently examines the impact of the agreement reached. “We are looking at the deal in detail and then we will decide how to move on.” Did not exclude price increases in the US.

3. How important are the mitigations?

At least compared to the duties in force today, the agreement represents a remarkable relief for the industry. This is evident from a recent calculation of the Kiel Institute for the World Economy (IFW) for Handelsblatt.

According to the calculation, duties agreed now would be reduced The German gross domestic product (GDP) by 0.15% in one year.

If the previous duties in cars were left in force, The German economy would have grown by 0.51% less, according to experts.

However, for years, the US has only charged 2.5% to car imports – compared to 15%, a five -fold increase. Automotives are likely to compensate for part of this cost through lower profit margins in the future.

4. Who benefits, who loses?

In principle, one Single duty disproportionately affects premium manufacturers. The higher the value of the vehicle, the higher the special tax.

This causes Increase prices in the US market, which in turn could reduce demand.

At the same time, BMW and Mercedes-Benz, in particular, already have large US production facilities.

Both companies had pushed for a different solution. Their Managing Directors in Washington had repeatedly supported a so -called export compensation, in which manufacturers’ exports from their plants to the US would be offset by imports from Europe. This would favor the two high quality manufacturers.

Only BMW, with its production, contributes ten billion dollars to export volumes annually to the US trade balance, according to data from Tradeimex Commercial Services provider.

According to the VDA (German Car Manufacturers Association), the US imported about 450,000 vehicles from Germany last year. At the same time, German manufacturers produced more than 844,000 vehicles in the US, about half of which were exported worldwide.

German factories could lose. A BMW or Mercedes car made in the US can now be exported to Europe with significantly lower or no duties. On the contrary, exports from factories to Germany are at a disadvantage with a 15%duty. Thus, what is good for companies is by no means good for German workers.

Unlike BMW and Mercedes-Benz, the Volkswagen group produces almost nothing in the US. In Chattanooga, Tennessee, the group manufactures vehicles from its basic brand, such as ID.4 electric car and SUV Atlas. However, models from premium brands Audi and Porsche are produced almost exclusively in the EU. This makes them particularly vulnerable to duties.

5. What is the trade balance of German automakers with the US?

The US is Germany’s most important partner in car trade. According to VDA (German Car Manufacturers Association), The total volume of trading between the two countries last year was almost 45 billion euros.

Although German automakers are already contributing to the US trade balance with their US factories, Trump is worried about his huge balance imbalance. While German exports amount to about 37 billion euros, vehicles worth just 8 billion euros are imported from the US.

With the agreement, however, American manufacturersThe General Motors and Ford could soon sell more vehicles in Europe – At least this is Trump’s hope.

“I think the peoples of Europe will gain a little more diversity than it. I think they’ll be happy about it »said Trump.

6. What does the agreement on the future investments of German automakers mean?

The EU is also committed to investing $ 600 billion in the US. How many of them will the German automakers contribute to be unclear.

However, German automakers had previously promised extensive investment in the US with the hope of a deal. For example, Mercedes plans to carry part of the production of the Best-Seller SUV GLC with European combustion engines in the US starting in 2027, and also the production of V-Class.

BMW is committed to building a battery factory and assembled a total of six electric models in South Carolina.

Audi, part of the VW Group, is reportedly considering constructing a factory in the US. A VW basic brand spokesman recently said, answering a Handelsblatt question, that the group is discussing “future production of additional models in North America”. However, final decisions have not yet been made.

However, VDA Müller president also urges to strengthen the domestic economy. Given the extensive commitments, the EU “is now urgently called upon to shape the framework in Europe so that investors and companies are internationally competitive.” This should make the domestic investment location more attractive and relative again.

7. What car duties apply to manufacturers in other countries?

Vehicles are also the most important exportable product for Great Britain. The government led by Prime Minister Keir Starmer has therefore tried to negotiate exceptions for the automotive industry. In June, both sides agreed to a quota solution.

A Reduced rate of 10% applies to the first 100,000 cars sent by Great Britain to the US. Beyond that, the normal rate is 27.5%today.

In addition to Jaguar Land Rover, BMW is also the main beneficiary: Mini and Rolls-Royce, two corporate brands, are based in Great Britain.

Last week, Japan concluded a similar agreement with the US to the EU. Both economies agreed to a 15 -percent US main duty, which also applies to imports of Japanese cars.

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