European Union Trade Commissioner Cecilia Malmstrom expressed a lukewarm, at best, attitude toward a potential plurilateral deal to lower auto tariffs, but left the door open to exploring all options.
“On this plurilateral idea that is circulating around the world – this is one of many,” Malmstrom told reporters in Brussels last Thursday, as quoted by Inside Trade. “And for it to work, you would have to include the mass of the big car producers.… I don’t know if they [would]. Maybe it’s worth exploring but it’s not sort of a solution,” she added.
“To negotiate, we need a mandate,” she said. “We don’t have a mandate to negotiate anything because we don’t know what we would potentially negotiate. As I said, the president goes there with an open mind to build on the relationship that is already there and see if there is a way we can engage.”
The deal was proposed by Trump administration officials after the White House threatened to raise tariffs significantly on all auto imports. The prospect of import taxes on cars prompted concern from US allies, and European officials signaled a willingness to negotiate a plurilateral agreement.
Malmstrom and European Commission President Jean-Claude Juncker will be in Washington this week to discuss pressing trade issues, including tariffs on steel and aluminum that have already been imposed, and the possible auto tariffs. Juncker is scheduled to meet with President Donald Trump on Wednesday, while Malmstrom will talk with lawmakers and business groups.
“Let’s also keep in mind that US car producers did not ask for this,” Malmstrom said in her remarks last week. “Neither did the unions, the car dealers, the US Chamber of Commerce or the Republican Party. Why? Because the US car industry is closely integrated into global supply chains – and not just in North America.
“Again, ripping apart those supply chains would only result in less production, and less investment, and fewer jobs in the US. So tariff measures on cars are neither wanted nor warranted. At best, they are a solution in search of a problem. At worst, they are an illegal move to gain leverage in trade negotiations,” she stressed.