Trump Backs Down from 25% EU Car Tariff Threat, Extends Deadline to July 4

President Donald Trump has abandoned his plan to increase tariffs on cars and trucks imported from Europe, delaying the proposed hike from 15% to 25% that was set to take effect this week.

The European Union now has until July 4 to finalize a trade deal with the United States. Trump announced the delay in a social media post, stating he had a “great call” with European Commission President Ursula von der Leyen and agreed to postpone the tariff increase.

In his post, Trump warned that if the EU fails to implement the trade deal by America’s 250th Independence Day, tariffs will “immediately jump to much higher levels.” He did not specify the new rate or whether the tariffs would extend beyond vehicles.

Von der Leyen responded to the announcement, stating that “good progress is being made towards tariff reduction by early July.” She added,

“We remain fully committed, on both sides [US and EU], to its implementation.”

Court Rules Against Trump’s 10% Global Tariff

In a separate legal setback, the United States Court of International Trade ruled that the Trump administration’s 10% global tariff is illegal. The court found that Section 122 of the Trade Act of 1974 does not authorize the president to impose such tariffs under current economic conditions.

The ruling stated that Section 122 is a “narrow, time-limited tool” intended for specific balance-of-payments crises, not a broad authority to impose worldwide trade restrictions. The decision follows a recent Supreme Court ruling that struck down tariffs imposed under the International Emergency Economic Powers Act.

The government had introduced the 10% tariff using Section 122 after the Supreme Court ruling, prompting a lawsuit from the Liberty Justice Center on behalf of businesses Burlap Barrel and Basic Fun!. The court barred the administration from collecting duties from Washington state and the two companies but did not issue nationwide relief for other importers who have paid or continue to pay the tariffs.