The European U.S. Auto Market Tariff
Currently, in the second quarter of 2018, President Donald Trump is threatening tariffs on the European Union’s automobile sector. After starting an escalating tariff battle with China, Trump is aiming his eyes on his next target. Unfortunately, this will not only hurt the EU but will hit back at the US. This decision not only will cause a rapid tariff response from the EU, but it will damage US auto sales. If anything, this would stir many auto enthusiasts to avoid American automobiles, in the EU and US. Obviously, this is a “very, very” bad idea, especially with Ford removing sedans from the lineup. A European U.S. auto market tariff is simply put, a terrible idea.
How Much Damage Can a 20% Tariff Cause?
NFTC Says Trump Tariffs a ‘Double Whammy’ on U.S. Manufacturers
A 20% European U.S. market tariff can cause damage to both the EU and US. Firstly, a tariff damages the country, or countries, that it targets. Obviously, a main effect will be a drop in EU auto sales in the US market. Secondly, the tariff will impact the country that sends it. The first impact will be a revenge tariff hurting US businesses nationwide. The second impact is that it will most likely degrade the US market’s auto sales in the EU and US. Thirdly, taxes hurt everyone. The tax against the EU will hurt sales, the tax against the US will drop tax profits in the auto market, and it will also hit the pocket of US citizens. Who wants that?
Negotiations, Not Tariffs, Should be the Option
Impact of Trump’s potential auto tariffs on American consumers – Fox Business – YouTube
Instead of causing a tariff war worldwide, why not attempt to negotiate to improve the US’s trade options? Placing tariffs on foreign goods is not only hurting the countries that it targets, but it is causing suffering back home. For instance, China’s response to US tariffs was to place tariffs on American products such as pork and whiskey. This is hurting many businesses nationwide which doesn’t seem like a victory at all. By hurting businesses, the government is also hurting the individual citizens nationwide. Overall, the European US auto market tariff threat by President Trump is simply a “terrible, terrible” idea.