European carmakers warn against EU-US trade war

European carmakers warn against EU-US trade war

BERLIN
European carmakers warn against EU-US trade war

Swedish newly-elected President of ACEA (European Automobile Manufacturers Association) and Mercedes-Benz CEO Ola Kallenius addresses a press conference in Brussels on Jan. 16, 2025.

Europe's biggest automakers have called on the European Union to avoid a "trade conflict" with the United States, days before Donald Trump officially returns as president.

Trump has repeatedly threatened to hike tariffs on European products, as well as goods made by China and other allies like Canada.

"If we end up in a trade conflict, our clear assessment is that would be significantly economically harmful to the EU and to the European auto industry," warned Ola Kallenius, Mercedes CEO and new president of the European Automobile Manufacturers' Association (ACEA).

In a letter to European Commission President Ursula von der Leyen, the European automotive lobby urged the EU to "try to avoid a potential trade conflict."

For German auto giant Mercedes, the U.S. market represented around 15 percent of its global car sales in 2024.

ACEA repeated its call for the European Union to be "flexible" in its scramble to cut greenhouse gas emissions.

European carmakers are especially opposed to potential fines the EU could impose if they fail to meet 2025 emissions reduction targets.

The struggling industry has also faced difficulties selling electric cars and has called for support measures rather than financial penalties.

In an interview with AFP, ACEA director general Sigrid de Vries warned the risk was "existential" for the industry as many manufacturers have announced job cuts in Europe.

"We cannot just live on financial services or other services. We need a manufacturing industry footprint. We need innovation here and we need also to be able to export to other regions," de Vries said.

De Vries also said the electric vehicle market was "not developing as it should be".

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