Institution: Trump plans to raise auto tariffs, potentially causing nearly $18 billion in German manufacturing losses

Golden Finance reports that on May 2, an economic institution analyzed that U.S. President Donald Trump’s announcement to impose additional tariffs on European Union cars and trucks could lead to Germany losing nearly 15 billion euros (about 175.8 million USD) in value.

The estimate by the Kiel Institute for the World Economy (IfW) highlights the vulnerability of the EU’s largest economy to U.S. import tariffs—such tariffs have already caused the German auto industry to suffer losses of billions of euros. The institute’s analysis states that “the impact will be very significant,” and that in the long term, the loss of output will rise to about 30 billion euros.

Moritz Schularick, director of the Kiel Institute for the World Economy, said. Trump announced on Friday that next week it would raise the EU’s car tariffs from the previously agreed 15% to 25%, on the grounds that the EU has not complied with the trade agreement reached with Washington.

Julian Sinz, an economist at the Kiel Institute for the World Economy, said: “Germany’s economy growth, which is already sluggish, will be dealt a severe blow.” The institute currently estimates that Germany’s economy will grow by 0.8% this year.

The institute added that European economies with large automobile industries, such as Italy, Slovakia, and Sweden, may also suffer significant losses.

Jens Sudeck, chief advisor to Germany’s Minister of Economic Affairs, advised keeping caution regarding Trump’s move. Sudeck told: “The EU only needs to wait and see for now. As is well known, Trump at the drop of a hat withdraws or retracts his high-profile threats of tariffs.”

He pointed out that it is not yet clear why Trump believes the EU has not complied with the existing trade agreement, and whether the latest tariff threat has a legal basis. The advisor said: “All of this seems quite impulsive.” (East News Agency)