Across the Rhine, the day had started well: buoyed by the optimism aroused by the appeasement of the Sino-American trade conflict, the DAX, benchmark index of the Frankfurt Stock Exchange, established, at the opening of the session, Wednesday January 22, a new historic record, at 13,640 points. But the euphoria was short-lived. The threat, made the same day by Donald Trump in Davos (Switzerland), of imposing a customs duty of 25% on European cars imported into the United States, quickly sealed the mood.
"If tariffs on imports of cars came into effect, it would have a considerable impact on world trade, and especially on German exports", moved Volker Treier, president of the German Federation of Chambers of Commerce and Industry. In 2018, German manufacturers exported 470,000 cars to the United States, or 9% of the 5.1 million cars produced in their factories.
World sales down
A 25% tax could ultimately cut deliveries by half, according to the IFO Economic Institute in Munich. A major blow to this major sector of the national economy, which employs 800,000 people. Especially since 2019 was a difficult year for the German car industry, battered by the decline in world sales.
Affected by Mr. Trump's anger since his arrival at the White House in January 2017, Volkswagen, Daimler and BMW have so far managed to coax him with promises of investment in the United States. However, if the customs dispute between Brussels and Washington worsens, economist Gabriel Felbermayr, director of the IfW Institute in Kiel, recommends a response that should appeal to Paris. "With a digital tax, Europe could show the United States what wood it heats", suggests the expert. For this, Berlin would have to forget its reluctance against the plan for a European GAFA tax, which was finally buried in March 2019.
