US to adopt 25% car levy soon unless EU clears trade deal

[WASHINGTON] Andrew Puzder, the US ambassador to the EU, said Washington will implement 25 per cent tariffs on cars and trucks from the EU “relatively soon” if the bloc does not swiftly ratify a long-delayed trade deal. 

“Unless we see some substantial progress, I think you probably should expect those relatively soon,” he said.

US President Donald Trump recently vowed to slap 25 per cent tariffs on European vehicles, accusing the bloc of taking too long to ratify the agreement, which was initially reached in July 2025.

The EU, meanwhile, is frustrated over several Trump moves, which it argues has breached Washington’s commitments under the pact.

Puzder’s comments have added pressure to EU negotiators this week, as they try to finalise proposed amendments to the deal. 

“What the president was saying was, ‘Look, this has gone on long enough’,” he said. “You’ve done nothing for nine months.”

The potential car tariffs have brought long-standing transatlantic trade tensions to a head. 

Under the original deal, the EU agreed to erase levies on US industrial goods in exchange for a 15 per cent tariff ceiling on most European products, including vehicles.

A 25 per cent car tariff would therefore violate that ceiling. 

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The EU has warned it is ready to retaliate, but it would prefer to de-escalate and preserve the existing pact.

On Tuesday (May 5), EU trade chief Maros Sefcovic told Jamieson Greer, the US trade representative, that the bloc wants the main parts of the agreement in place by July.

Sefcovic also pushed Washington to respect previous trade commitments.

Puzder said: “I think the president’s saying he’s pushing for something more rapid, something quicker.”

Europe is also smarting over Washington’s decision to extend a 50 per cent tariff on metals to hundreds of products that include steel and aluminum, such as motorcycles and tableware.

Recently, the US attempted to address Europe’s frustration, changing the way the tariff is calculated and exempting some products.

But it did little to help, with officials saying the tweak actually made the situation worse for roughly half of the affected products.

Puzder said the two sides would continue discussing the matter.

EU lawmakers are now negotiating with capitals over final amendments to the trade agreement, including a potential expiry date.

Officials will meet Wednesday evening for talks, but a final agreement is not expected until June.

Puzder chided the European parliament for trying to “renegotiate the deal”, arguing that the US was “done debating”.

He warned that Trump was willing to ditch the overall agreement if the EU imposed additional trade measures.

“If a deal isn’t a deal, then the US, I think, would walk away from it,” he said.

Trade is not the only area in which transatlantic relations are souring.

Trump has repeatedly threatened the Nato military alliance, trashed the EU’s tech rules and vented frustration over Europe’s refusal to provide military support for the US-Israel war against Iran. 

Trump even said he would yank 5,000 US troops from Germany, after German Chancellor Friedrich Merz said US negotiators were being “humiliated” in talks with Iran. BLOOMBERG