Trump threatens to reimpose 25% tariffs on EU autos as trade deal falters
The ink on the US-EU trade deal barely had time to dry before things started going sideways. President Donald Trump has announced plans to hike tariffs on European-made cars and trucks from 15% back to 25%, accusing Brussels of dragging its feet on commitments made under the so-called Turnberry Agreement reached in July 2025.
The move targets what US officials characterize as non-compliance by the EU, which has yet to push through the legislative changes required to implement its side of the bargain. EU representatives, for their part, point to internal political challenges and a parliamentary approval process that doesn’t move on anyone else’s timeline.
What the Turnberry Agreement was supposed to do
The Turnberry Agreement came out of a meeting between Trump and European Commission President Ursula von der Leyen in July 2025. It established a 15% tariff ceiling on most goods traded between the two blocs, a framework designed to pull both sides back from the brink of a full-scale trade war.
That 15% rate was already a compromise. It represented a significant reduction from the 25% tariffs Trump had previously imposed on European automobiles. The deal was supposed to create breathing room for broader trade stability.
US Ambassador to the EU Andrew Puzder has framed the situation bluntly, arguing that the tariff increase isn’t escalation for its own sake but rather a consequence of the EU enjoying the benefits of the deal without delivering on its obligations.
The auto sector braces for impact
Analysts estimate that the tariff hike could add approximately $6,000 to the average price of a European import vehicle sold in the US. European automakers, many of whom adjusted production and pricing strategies around the 15% rate, now face the prospect of recalibrating again. German manufacturers like BMW, Mercedes-Benz, and Volkswagen ship substantial volumes to the US market, making them particularly exposed.
