Where's the Trade Deal That Really Matters for Detroit?

Bloomberg

4 days ago

Some 15 Super Bowls ago, Chrysler wowed the viewing public with a long car commercial starring Eminem that featured the tagline 'Imported From Detroit'. This was ironic, doubly so because the venerable automaker had been recently rescued from bankruptcy by Italy's Fiat (it is now part of Stellantis NV). That paradoxical spirit is alive and well in the US-EU trade deal announced this weekend, with a kind of relief for European carmakers serving to emphasize the squeeze that President Donald Trump's tariffs have put on America's auto sector. Coming soon after another deal announced with Japan, however, Detroit may have reason for hope.
As with that deal, the US set tariffs of 15% on a range of imported goods, including autos. There's been little more by way of details. Still, the levy being lower than what had been threatened, it offered that sort of qualified relief felt when you escape utter catastrophe and are merely maimed. The US imported about 800,000 vehicles from the EU last year — about 5% of the US market — and the new tariff represents a roughly 4 billion euro saving versus even higher penalties, according to Bloomberg Intelligence. BMW AG and Mercedes-Benz Group AG benefit especially due to the zero tariff set on US auto exports to Europe, since they are expected to send roughly 180,000 vehicles from US factories, mostly SUVs, back across the Atlantic this year.