The US imposing a 25% customs duty on a large portion of the automobile and automotive parts trade has begun to be discussed by all sector representatives on the grounds that it will seriously affect the global automotive industry worldwide.

While the tariff changes in the US trade area may lead other countries to increase their trade with each other to compensate for their sales losses in the US, what will happen remains uncertain. On the other hand, the concern in the automotive industry worldwide is increasing.

In addition to the 10% general customs duty applied to all goods, the US has determined rates of 20% for the EU, 24% for Japan, 25% for South Korea and 10% for the UK. The 25% tariff applied to steel and aluminum remains valid for all countries. A lower tariff of 12.5% ​​will be applied to vehicles with 50% American content for automobile exports from Canada and Mexico.

Canada has announced that it will fight the new US tariffs “in a purposeful and powerful manner”, while the EU has announced that it will start a “strategic dialogue” with the European automotive sector to deal with these tariffs. It is also expected that the global economy will suffer from this situation.

In the UK, it is stated that the costs of these tariffs will not be borne by manufacturers. This could lead to US consumers facing higher costs and fewer options. British manufacturers may also have to reconsider their production plans due to limited demand.

There are different views on the potential loss of exports due to retaliatory measures against the US tariffs. On the other hand, the relocalization of car production is expected to accelerate with the power of the tariffs. The US decision to implement the 25% tariff is due to the significant growth of foreign automotive industries supported by production subsidies and aggressive industrial policies. In contrast, it is seen that approximately half of the vehicles sold in the US are manufactured domestically.

Similar concerns are also on the agenda in Europe. The EU has made statements in favor of a constructive solution to trade tariffs, while also expressing a desire to take steps based on joint efforts. Europe’s automotive industry has highlighted the potential impact on both manufacturers and suppliers, including European companies that manufacture vehicles and parts in North America.

According to the European Automobile Manufacturers Association (ACEA), European automakers exported 757,654 new vehicles to the United States in 2024, worth 38.9 billion euros ($43.3 billion). This figure largely dwarfs the 169,152 new vehicles the EU imported from the United States, worth 7.8 billion euros.

In contrast, ACEA says international automakers produce about 4.9 million vehicles a year in the United States, equivalent to 48% of total production. It says European-based companies account for about 830,000 vehicles, while 50% to 60% of U.S.-made vehicles are exported.

European automotive suppliers and parts manufacturers are doubly affected by both direct automotive tariffs and tariffs on aluminum and steel components. The EU supplier industry, which previously sought to offset the negative trade balance created by the doubling of Chinese imports to Europe, has increased its trade with the US. This has made the sector particularly vulnerable to tariffs. Annual automotive component exports to the US of €8.7 billion over the past five years have contributed to a global trade surplus of €7 billion for European suppliers.

The 25% tariffs imposed by the US on imported automobiles, which came into effect on Thursday, could force global automakers to take serious steps in many areas, from employment planning to shipment pauses, from price increases to production planning delays. As a result, these tariffs are expected to lead to increased automobile prices on a global scale. While the direct impact of the reciprocal tariffs on the automotive industry is limited, their repercussions on the global economy are expected to be serious.