Those Trump Tariffs Have Got EU Manufacturers Keen to Negotiate

You have to hand it to President Trump. Not only does he bring together a coalition of the willing on the thorny issue of Gaza, but he’s brought Mexico, Canada and other nations to the table to reframe and update the old trade deals that previous US Administrations signed. Maybe it is time the EU swallowed its pride and began some Realpolitik?

Here’s the word from the VDMA;

In a conversation with Trade Commissioner Maroš Šefčovič, VDMA President Bertram Kawlath urged the EU to renegotiate the expansion of U.S. tariffs on steel and aluminum products with the United States. Machinery products must be excluded from these tariffs, as they pose a direct threat to the industrial SME sector. This is confirmed by statements from numerous VDMA member companies.

Regarding the meeting with EU Commissioner Šefčovič, VDMA President Kawlath stated:

• “40 percent of European machinery exports to the U.S. are already subject to the expanded tariffs on steel and aluminum products introduced by the U.S. government in August. More products will be added soon. This immense new tariff burden on European machinery manufacturers contradicts the spirit and purpose of the tariff deal agreed between Commission President Ursula von der Leyen and U.S. President Trump in Scotland.”
• “The EU must not accept the extensive market isolation by the U.S. without protest and must strongly advocate for the removal of tariffs on machinery products. This is also in the interest of U.S. industry, which relies on European production technology to build and maintain its industrial base.”

VDMA member companies on the impact of U.S. tariffs:

• Jan-Hendrik Mohr, CEO of CLAAS Group:

“A stable and predictable trade policy is essential for internationally operating industrial companies. The special tariffs on steel and aluminum cause significant administrative burdens and may counteract the onshoring of production. It is crucial to ensure U.S. farmers have access to affordable agricultural machinery. Therefore, targeted exemptions for agricultural machinery from Section 232 tariffs and a predictable regulatory framework are vital. Additionally, CLAAS manufactures in the U.S. for export as well, so tariff refunds are urgently needed to improve competitiveness.”

• Martin Drasch, CEO of ANDRITZ Schuler:

“The flat tariff of 15 percent negotiated between the U.S. and the EU applies to our products only in exceptional cases, as many of our products have since been added to the Section 232 derivative list. Our systems are primarily made of steel, which is still subject to a 50 percent tariff. Adding to the burden, we must calculate and prove the exact raw steel content of all individual components. We are required to specify where the steel was melted and cast; otherwise, the goods cannot be cleared and delivered. The enormous bureaucratic effort and the additional costs on top of the tariffs are significant and painful competitive disadvantages.

Further uncertainty arises from the fact that the tariff deal between the EU and the U.S. is only valid for four months – after which the Section 232 tariffs will be reviewed again. Thus, the deal has not delivered what the market urgently needs: clarity, reliability, and predictability. The tariffs are detrimental to both our American customers and ourselves, increasing inefficiency. Ultimately, delivery times are extended and our products become more expensive for U.S. customers – even though they urgently need them for the intended re-industrialization.”

• Dr. Klaus Geißdörfer, CEO of ebm-papst Group:

“The current U.S. punitive tariffs – especially the additional burden of 50 percent tariffs on aluminum – directly affect our axial fans and impair our transatlantic business relations.

As a globally active company, we support the VDMA’s call for renegotiations. Only reliable framework conditions can ensure the international competitiveness of mechanical engineering.”