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Home » U.S. Lowers Tariffs on EU Autos to 15%, Cementing Trade Deal Terms

U.S. Lowers Tariffs on EU Autos to 15%, Cementing Trade Deal Terms

CLOSE-UP OF A TIRE ON A VOLKSWAGEN CAR. THE VW LOGO CAN BE SEEN IN THE MIDDLE OF THE TIRE.
Lisbon, Portugal. Photo: iStock.com/Ivan Kyryk
September 25, 2025
Bloomberg

The U.S. lowered tariffs on auto imports from the European Union to 15% retroactive to August 1, cementing terms of the framework trade agreement the two sides struck almost two months ago.

The Department of Commerce and Office of the U.S. Trade Representative published a document online on September 24, detailing the changes, reducing duties on a range of goods. 

The order will help to further ease tensions between Washington and Brussels, as the two sides work through implementing the details of the trade deal they announced at one of President Donald Trump’s golf courses in Scotland.

The formality of the Federal Register filing will be especially welcome news for Europe’s auto industry, which has been waiting for several weeks for the lower duties to be adopted.

Shares of German carmakers Volkswagen AG, Porsche AG and Mercedes-Benz Group AG gained on the news. Porsche, which is among the hardest hit by the U.S. tariffs as it sells only imports there, rose as much as 3.8% in Frankfurt on September 24.

TOP TEN CAR IMPORTERS INTO THE US SEPT 2025 BLOOMBERG.png

The changes laid out in the filing include a list of exemptions for sectors including aircraft, aircraft parts and generic pharmaceutical drugs plus ingredients, as well as “unavailable natural resources” such as cork  and certain metals and ores, effective September 1. Those goods will maintain lower so-called most favored nation, or MFN, rates.

Most of the new rates take effect for EU goods shipped starting September 1, but the relief for automobiles and parts was contingent on the EU introducing legislation to lower tariffs on American industrial goods and some non-sensitive agricultural products. 

The bloc followed through with that action on August 28, and is currently in the process of implementing its concessions, paving the way for the Trump administration to backdate the new auto charge.

Previously, those vehicles faced a 25% U.S. duty on top of prior levies of 2.5%.

As part of the arrangements in the trade deal, the EU faces a 15% tariff ceiling on most of its exports. That rate doesn’t stack on top of any existing industry-specific tariffs, and the EU expects it to also cover any future sectoral levies that may be introduced on drugs and chips.

However, the two sides have yet to make much progress on reaching an accord to lower tariffs on steel and aluminum, where the bloc is currently facing 50% duties on its exports.

Other goods already subject to tariffs above 15% under MFN arrangements will continue to be taxed at those higher levels.

The U.S. said in its notice that the list of products may yet be amended. The move followed an executive order that Trump signed earlier in September that smoothed the process for his administration to adjust tariff rates for imports from economies with which he struck trade pacts.

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