Berlin’s powerful machinery lobby, the VDMA, has fired off a stark warning over the European Commission’s latest trade proposal: removing duties on U.S. industrial goods in exchange for lower U.S. car tariffs. The move, the VDMA says, risks undercutting one of Europe’s strongest industries.
On Thursday, the Commission proposed lifting levies on imported American machinery and equipment if Washington cuts its car tariffs to 15% from 27.5% starting August 1. The agreement ended a long-running clash between the world’s two largest trading and investment partners, but it’s far from balanced.
Data reveals the asymmetry: while U.S. duties on European cars fall sharply, the United States retains tariffs on 70% of EU exports. In 2024 alone, the U.S. merchandise trade deficit with the EU swelled to $235 billion, fueling transatlantic tensions.
“Duty-free access for U.S. products while simultaneously extending punitive tariffs to European machinery is a direct slap in the face,” the VDMA said on Friday. Representing some 3,600 firms, the lobby warns the deal could cost jobs and erode Europe’s competitive edge.
The VDMA is calling on the EU Commission to renegotiate urgently, demanding that mechanical engineering products be clearly and permanently exempted from any sectoral tariffs. With global supply chains and green transition goals on the line, Brussels must weigh market access against protecting its industrial backbone.
As EU capitals digest the fallout, all eyes turn to the next round of talks. Can Brussels secure a fair carve-out for European machinery, or will the sector bear the brunt of an asymmetric bargain?
Reference(s):
cgtn.com
