Tariff Wars: The Dawn of the EU Trade Deal

Tariff Wars: The Dawn of the EU Trade Deal

Von der Leyen and Trump launch a new phase of transatlantic trade, restoring stability while managing protectionist limits.

On 27 July 2025, European Commission President Ursula von der Leyen and US President Donald J. Trump announced a political agreement that resets the framework of EU-US trade. With over €1.6 trillion in annual flows at stake, the transatlantic corridor is the world’s largest trade and investment relationship.

The centrepiece of the deal is a 15% tariff ceiling on EU exports to the United States. This single cap is expected to replace a complex mix of stacked duties, providing much-needed relief for sectors such as automotive, aerospace, chemicals, and pharmaceuticals. Car tariffs, currently running as high as 25% plus surcharges, are expected to fall under this ceiling. Aircraft, critical chemicals, and other strategic exports shall also soon see tariff relief once implementing orders and customs guidance are issued.

The agreement also expands US market access into Europe. EU buyers will procure nearly €700 billion of US liquified natural gas, oil, and nuclear energy products by 2028, alongside €40 billion in AI chips. Meanwhile, American exporters gain improved access to European markets for select agricultural and fishery products, all within carefully managed quotas.

For logistics networks, this pact signals a return to predictability in transatlantic flows. Lower tariffs and reduced non-tariff barriers will ease friction in container shipping, air freight, and supply chains, as sector specifics are phased in. Coordinated action on steel, aluminum,