Sales of Volkswagen in North America have fallen by 16 percent in the past three months. This is due to import duties imposed by President Donald Trump on European cars. On Monday, Mercedes-Benz already reported that sales in the United States have fallen by 9 percent.
This means that two major German car manufacturers have been hit hard by the American tariffs. Trump wants to protect his own economy by having American companies pay an extra tax for foreign products. For cars from Europe, this concerns a tariff of 25 percent.
It makes the vehicles considerably more expensive. Trump hopes that this will encourage Americans to choose a car from their own country more often. It is not yet clear whether they will do so, but it is at least causing problems for the German manufacturers.
It should be noted that with Volkswagen’s declining figures, sales in the US in the first quarter were actually 4.4 percent higher than a year earlier. Americans may have quickly bought a German car before the tariffs applied.
German car concerns are also heavily affected by China
The German car sector was already in trouble. In addition to declining sales in the US, there is fierce competition from China in the electric car market. For example, Mercedes-Benz saw its sales in China fall by 19 percent last quarter.
In addition, Chinese electric cars have found their way to the European market. There, they have quickly become very popular due to, among other things, the price. This irritates European manufacturers and the European Commission.
The European Commission stated last year that there is unfair competition because Chinese car manufacturers would receive more state aid than European companies. Brussels therefore introduced import duties of up to almost 40 percent for Chinese electric cars. China was not happy with this and has taken countermeasures.
Meanwhile, the EU is trying to conclude a trade agreement with the Americans. Trump had initially set yesterday as the deadline. But on Monday evening he announced that he would move that deadline to August 1.
In the coming weeks, both camps want to reach an agreement that covers not only cars, but all mutual trade in goods. It is not yet clear what that deal will look like.