Trump raises EU car tariffs to 25% in escalating trade dispute

U.S. President Donald Trump announced Friday that he will raise tariffs on European Union cars and trucks to 25%, up from the 15% limit established in a July 2025 trade deal, accusing the EU of failing to comply with the agreement. European automakers are expected to open between 1.2% and 2.2% lower, with Germany's DAX falling 0.27%, France's CAC 40 sliding 0.1%, and Italy's FTSE MIB down 0.31%. The European Commission stated it is keeping its options open in response. German MEP Bernd Lange, chair of the European Parliament's trade committee, told Europe Today the tariffs are politically motivated and specifically target German manufacturers. "There are no legal or no economic reasons for those tariffs. This is really politically against Germany," Lange said. The escalation follows Trump's criticism of German Chancellor Friedrich Merz for refusing to contribute to U.S. military operations against Iran, as well as Trump's announcement that 5,000 U.S. troops would be withdrawn from Germany. The Turnberry agreement is now under discussion among EU governments and lawmakers, with Lange expressing doubt about its viability and warning that all retaliatory options are on the table, including counter-tariffs and export restrictions under the EU's anti-coercion instruments. The EU still maintains suspended retaliatory tariffs worth 93 billion euros. Elsewhere, Trump unveiled "Project Freedom," a plan to escort commercial ships through the Strait of Hormuz using 15,000 troops, guided missile destroyers, and 100 aircraft. The United Kingdom Maritime Trade Operations reported Monday that a vessel had been struck by projectiles north of Fujairah in the UAE. Oil prices edged lower, with Brent crude down 0.8% to $107.38 per barrel and West Texas Intermediate slipping 0.84% to $101.10. The U.K.'s FTSE 100 was closed for the early spring bank holiday.