European carmakers, the intended beneficiaries of the new US-EU trade deal, are now caught in a frustrating waiting game as their promised tariff relief is delayed by the intricacies of EU politics. The agreement’s condition that the EU must legislate first means the industry’s fate is no longer in Washington’s hands, but in the slow-moving gears of Brussels.
The deal promises to cut a crippling 27.5% US tariff to 15%, a move that would provide a massive boost to manufacturers. However, this relief is contingent on the European Commission introducing a bill to lower its own trade barriers, a process that is now subject to debate and potential delay among the 27 member states.
The main obstacle is the deal’s unpopularity with several key players. France is unhappy about the lack of protection for its wine industry, Spain is “unenthusiastic,” and Italy fears a major economic blow. This lack of a unified consensus could significantly slow down the drafting and introduction of the required legislation, leaving the auto industry in limbo.
Every month that passes without action costs the carmakers dearly. They are now forced to watch and wait as their political leaders navigate the complex trade-offs and internal divisions created by the very deal that was supposed to help them. For Europe’s auto giants, the path to relief is clear, but the road is blocked by politics.