European leaders, officials and business bosses are particularly worried about what they describe as the obsession of Trump and his acolytes with the German car industry.
If Trump follows through on that threat, as many believe he will, the consequences could be disastrous not just for Germany but for most of the EU’s major economies.
Manufacturers such as Volkswagen, BMW and Daimler operate plants in Britain, Spain, Poland, Belgium, the Czech Republic, Hungary, Romania and other countries. They source car parts from suppliers all across the EU.
The U.S. is the biggest importer of German cars, ahead of China, by value, so any tariffs would hit one of the major lifelines of Europe’s economy.
“We’re worried about Trump’s fixation on cars, because the German car industry is so deeply intertwined with every EU country,” said a third diplomat.
End game
The end game, for the EU side, would be a negotiated solution. Trump, they believe, may be trigger-happy on tariffs — but he’s also keen to negotiate. “He’s a deal-maker at heart,” said the third diplomat, citing Trump’s re-negotiation of the free-trade zone with Mexico and Canada, and deals with South Korea, Japan and China.