Washington/Brussels, May 2, 2026 — President Donald Trump said Friday he will raise tariffs on European Union cars and trucks to 25% next week, accusing Brussels of violating the Turnberry Agreement, the bilateral trade framework both sides signed last July. The move threatens to eliminate savings the EU estimated at 500–600 million euros ($585–$700 million) a month for European automakers and arrives as Trump faces a 30% economic approval rating in the latest AP-NORC poll.
The Legal Weapon: Section 232, Again
Trump will almost certainly use Section 232 of the Trade Expansion Act of 1962, the national security tariff authority, to impose the new rate, according to Scott Lincicome of the Cato Institute’s Center for Trade Policy Studies. This is not a new tool. Trump imposed 25% Section 232 auto tariffs in March 2025, then rolled them back as part of the Turnberry deal. He is now reaching for the same lever after the U.S. Supreme Court this year struck down the legal authority he had originally used to enforce the 15% Turnberry ceiling, ruling he had exceeded his powers in declaring an economic emergency.
Since that ruling, the administration has been operating on a temporary 10% rate while running two parallel Section 301 investigations under the Trade Act of 1974, one examining forced labour practices among trading partners, the other targeting alleged overproduction that undercuts American manufacturers on price. Neither has concluded. Neither provides the authority needed to reimpose the Turnberry-era tariff level. Section 232 does, and it bypasses both investigations entirely.
Lincicome did not soften his assessment of what this means for the broader framework: these deals are “vaporware” that “rely on handshakes and winks and hopes that Trump doesn’t get mad about something.”
What Trump Said and Didn’t Say
Trump posted the announcement on social media Friday without identifying which Turnberry obligations the EU had breached. Asked by reporters as he left the White House for Florida, he said the EU was “as usual” not adhering to the framework and that higher tariffs would force manufacturers to shift production to the U.S. faster. That is the administration’s public argument, a medium-term manufacturing relocation case being made during a short-term inflation crisis.
Annual U.S. inflation hit 3.3% in March, per the Bureau of Labor Statistics, above the rate Trump inherited and driven in part by energy costs linked to the effective closure of the Strait of Hormuz. The U.S. and Israel began strikes on Iran at the end of February; Brent crude has risen sharply since, with the IMF in April cutting its 2026 global growth forecast by 0.4 percentage points, citing Middle East energy disruption as the primary driver. A 25% auto tariff does not lower car prices. The administration has not addressed that contradiction publicly.
The EU Response: Measured, For Now
The European Commission said in a statement Friday that it was implementing Turnberry commitments “in line with standard legislative practice”, the standard language Brussels uses when its legislative calendar is being criticised for moving slowly. The European Parliament had been on track to formally ratify the agreement in June, according to a European Parliament spokesperson cited by Reuters on April 28. That timeline is now under active review, the spokesperson said.
Bernd Lange, chair of the European Parliament trade committee, called the tariff hike “unacceptable” on social media and accused the Trump administration of already having broken commitments on steel and aluminium. European Commissioner for Trade Maroš Šefčovič told a Brussels press conference on April 25 that the US-EU relationship had become “noticeably more constructive” over the past year. That assessment is now being reassessed inside the Commission, according to a senior EU official who spoke on condition of anonymity to Reuters Friday.
The EU’s formal retaliation process requires European Commission authorisation followed by qualified majority approval from EU member states, a minimum of 15 member states representing 65% of the bloc’s population. That process has not been formally initiated as of Friday evening, per the Commission’s trade directorate. It typically takes six to eight weeks once triggered.
The Industry Caught in the Middle
What stood out beyond the diplomatic exchange was the reaction from the U.S. side of the auto industry. Jennifer Safavian, CEO of Autos Drive America, which represents the American operations of foreign automakers including Volkswagen, BMW, Mercedes-Benz, and Stellantis, said the tariff increase “would threaten the progress that has already been made to open EU markets and grow the U.S. auto industry.” That is a domestic U.S. lobby group, not a European one, warning against a Trump tariff. It signals the damage lands on American soil as well.
The scale of what is at stake is not abstract. EU-U.S. goods and services trade totalled 1.7 trillion euros ($2 trillion) in 2024, averaging 4.6 billion euros a day, per Eurostat. European automakers had calculated the Turnberry ceiling was saving them 500–600 million euros monthly versus the pre-deal tariff regime. At a 25% rate, that saving is eliminated and the monthly cost burden increases materially beyond it, a figure neither the Commission nor the industry has publicly calculated yet, but which analysts at Berenberg estimated Friday could reach 900 million to 1.1 billion euros monthly for the sector as a whole.
Also Read: Trump’s 25% Auto Tariff: A New Challenge for Indian Carmakers and Auto Parts Manufacturers
FAQs
Q: Which car brands are most exposed to the 25% tariff?
European brands with significant assembly outside the U.S. face the steepest impact: Volkswagen, BMW, Mercedes-Benz, and Stellantis are the largest by U.S. import volume. Autos Drive America, their U.S. lobby, warned Friday the tariff would damage both EU market access and U.S. industry growth. Berenberg analysts estimated Friday the sector’s combined monthly cost burden could rise to 900 million–1.1 billion euros under a 25% regime, up from the 500–600 million euros monthly that the Turnberry ceiling was saving them, per EU figures.
Q: Can the EU retaliate, and how fast?
Yes, but not immediately. Formal EU retaliation requires European Commission authorisation and qualified majority approval from at least 15 member states representing 65% of the bloc’s population. That process has not been initiated as of Friday, per the Commission’s trade directorate. Once triggered, it takes a minimum of six to eight weeks. Brussels has previously prepared retaliatory target lists covering U.S. agricultural products, consumer goods, and industrial equipment; those lists remain available but unactivated.
Q: What is the legal basis for the 25% tariff?
Section 232 of the Trade Expansion Act of 1962 permits tariffs on national security grounds, per the Cato Institute’s Scott Lincicome. Trump used the same authority for 25% auto tariffs in March 2025 before rolling them back under Turnberry. The Supreme Court this year invalidated his original tariff authority; Section 232 is the strongest remaining lever and does not require the two ongoing Section 301 investigations to conclude first.
The European Parliament trade committee meets Wednesday. The Commission’s trade directorate is expected to brief member state ambassadors on retaliatory options by end of next week, per an EU official.
