Trump Says Tariffs on European Cars Are Coming If Trade Deal Falls Through

An employee mounts a wheel on a Mercedes Benz A Class on the assembly line at the Daimler AG factory in Rastatt, Germany, on Feb. 4, 2019. Thomas Kienzle/AFP via Getty Images

President Donald Trump told reporters on the sidelines of the World Economic Forum in Switzerland that if an expected trade deal with the European Union falls through, he would press ahead with tariffs on European cars.

“They know that I’m going to put tariffs on them if they don’t make a deal that’s a fair deal,” Trump told The Wall Street Journal in Davos on Jan. 21, referring to automobiles, the bloc’s key export.

The president did not specify a deadline for reaching the trade deal before greenlighting the tariffs.

President Donald Trump addresses the World Economic Forum at the congress centre in Davos, on Jan. 21, 2020. Evan Vucci/AP Photo

The White House has delayed slapping tariffs on cars from Europe several times. In November, the Trump administration let a deadline lapse on “Section 232” national security tariffs of as much as 25 percent on imported vehicles and parts under a Cold War-era trade law.

“The good news is that the U.S. did not announce any new tariffs on EU cars or car parts,” European Trade Commissioner Cecilia Malmstrom said in Brussels on Nov. 21, according to the Chicago Automobile Trade Association. “Of course the threat is not entirely gone, and we are mindful of that.”

A robot mounts a windshield on a Mercedes Benz A-Class on the assembly line at the Daimler AG factory in Rastatt, Germany, on Feb. 4, 2019. Thomas Kienzle/AFP via Getty Images

The Trump administration launched a Section 232 probe of foreign autos in May 2018, after which Trump agreed with conclusions that some imported vehicles and components are “weakening our internal economy” and could harm national security. An alternative to Section 232 action would be to apply tariffs under Section 301 of the Trade Act of 1974, the same mechanism used by the White House to impose tariffs on imports from China on grounds of a foreign country deploying unfair trade practices.

Trump also told The Wall Street Journal Tuesday that he struck a deal with French President Emmanuel Macron on postponing a digital services tax that was supposed to hit American tech firms sometime in 2020.

The president told the newspaper he threatened to impose a tariff of 100 percent on French wine, which currently faces an import duty of 25 percent in relation to a separate trade dispute involving European aviation giant Airbus.

‘In the Midst of an Economic Boom’

Trump hailed his economic and trade records in remarks on the first day of the economic summit in Davos, saying that America is “winning again like never before.”

“Today I am proud to declare that the United States is in the midst of an economic boom, the likes of which the world has never seen before,” he said.

In a campaign-style speech, Trump touted job creation, low unemployment, and wage growth.

“This is not a time for pessimism; this is a time for optimism,” Trump said. “Fear and doubt is not a good thought process because this is a time for tremendous hope and joy and optimism and action.”

“But to embrace the possibilities of tomorrow, we must reject the perennial prophets of doom and their predictions of the apocalypse,” the president said, highlighting failed predictions of yesteryear like global starvation in the 1970s or depletion of the world’s oil reserves in the 1990s.

“These alarmists always demand the same thing: absolute power to dominate, transform, and control every aspect of our lives,” Trump continued. “We will never let radical socialists destroy our economy, wreck our country, or eradicate our liberty. America will always be the proud, strong, and unyielding bastion of freedom.”

The economic summit in the Swiss Alpine town runs through to Jan. 24.

The high-profile forum brings together world leaders, business elites, economists, and celebrities from around the globe.

Emel Akan contributed to this report.