Mercedes-Benz Calls for US-EU Car Tariff Cuts as Trump Signals New Duties

On March 20, 2025, Mercedes-Benz, the German luxury automaker, urged the United States and the European Union to eliminate tariffs on car imports amid escalating trade tensions. The call came as U.S. President Donald Trump threatened to impose new duties on EU goods, raising fears of a broader trade war. Ola Källenius, CEO of Mercedes-Benz, highlighted the imbalance in current tariffs, noting that cars imported into Europe from the U.S. face a 10% tariff, while those entering the U.S. from Europe are subject to just 2.5%. He proposed scrapping these tariffs entirely, arguing that free trade would benefit both economies.

US-EU Car Tariff Cuts

The plea follows Trump’s recent tariff hikes on steel and aluminum, prompting retaliatory measures from the EU and Canada. With the U.S. set to unveil country-specific tariffs on April 2, European automakers like Mercedes-Benz, BMW, and Audi are bracing for potential impacts. Källenius’s stance reflects a broader industry concern as German carmakers, heavily reliant on exports, face profit risks. BMW, for instance, anticipates a €1 billion earnings hit in 2025 due to U.S. tariffs. As Trump’s policies loom, Mercedes-Benz’s push for zero tariffs underscores a critical moment for global automotive trade.

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