Facing a Wednesday deadline, President Trump is expected to announce he is delaying his decision on whether to impose tariffs on European Union autos for another six months.
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In May, Trump instructed U.S. Trade Representative Robert Lighthizer to make a trade deal with Japan and the European Union and "report back to him within 180 days on the progress," the daily political website Politico reported. The report comes on the heels of comments from outgoing European Commission President Jean-Claude Juncker four days ago, who told the Geman publication Sueddeutsche Zeitung, "Trump is going to make some criticism, but there won’t be any auto tariffs.”
According to the Center for Automotive Research, tariffs of 25 percent would increase the price of import cars by about $6,875. But increases would not be limited to foreign cars, as the likes of Ford and GM would likely see prices rise by about $4,400, CAR said, since domestic manufacturers rely on global supply chains to manufacture automobiles.
Meanwhile, the EU carmakers are well represented in the U.S. with lines of vehicles made here. German automaker Volkswagen AG has a factory in Chattanooga, Tenn., BMW AG has a large factory in South Carolina and Mercedes-Benz recently invested $1 billion in a plant in Tuscaloosa, Ala.
While a deal was recently reached with Japan, negotiations with the EU have been slow in part because, according to Politico, the EU's refusal to include agriculture as part of the trade talks.