The United States on Thursday said it was moving ahead with tariffs on aluminum and steel imports from Canada, Mexico and the European Union, ending a two-month exemption and potentially setting the stage for a trade war with some of America's top allies.
At the same time, a magazine reported US President Donald Trump was now focused on pushing German cars from the country.
US Commerce Secretary Wilbur Ross told reporters on a telephone briefing that a 25 percent tariff on steel imports and a 10 percent tariff on aluminum imports from the EU, Canada and Mexico would go into effect at midnight.
"We look forward to continued negotiations, both with Canada and Mexico on the one hand, and with the European Commission on the other hand, because there are other issues that we also need to get resolved," he said.
Ross offered little detail about what the EU, Canada and Mexico could do to have the tariffs lifted.
The tariffs, which have prompted several challenges at the WTO, are aimed at allowing the US steel and aluminum industries to increase their capacity utilization rates above 80 percent for the first time in years.
The Trump administration has given permanent metals tariff exemptions to several countries including Australia, Argentina and South Korea, but in each case set import quotas.
Friday's deadline for exemptions also affects Mexico and Canada, which are in negotiations with the United States on the North American Free Trade Agreement that Trump has said he wants to revamp, or abandon if the talks fail.
In Europe, German magazine Wirtschaftswoche reported on Thursday that Trump had told French President Emmanuel Macron he wanted to stick to his trade policy long enough that Mercedes-Benz cars were no longer cruising through New York, news that dented share prices in BMW, Daimler and Volkswagen.
The Trump administration launched a national security investigation last week into car and truck imports, using the same 1962 law that he has applied to curb incoming steel and aluminum.
French Finance Minister Bruno Le Maire met Commerce Secretary Ross on Thursday hoping to end the stand-off.
"It's entirely up to US authorities whether they want to enter into a trade conflict with their biggest partner, Europe," Le Maire told reporters after the meeting.
Europe did not want a trade war, he said, but Washington had to back down from "unjustified, unjustifiable and dangerous tariffs." The European Union would respond with "all necessary measures" if the United States imposed them.
Ross hinted that tariffs were coming. "If there is an escalation it will be because the EU would have decided to retaliate," he told French daily Le Figaro.
"The next question would be: how will the president react? You saw his reaction when China decided to retaliate."
When China targeted key U.S. imports in retaliation against U.S. tariffs on $50 billion of Chinese goods in April, Trump ordered U.S. officials to identify a further $100 billion of Chinese products the United States could hit.
German Chancellor Angela Merkel said the European Union would give a "smart, determined and jointly agreed" response to new U.S. tariffs that she said would break World Trade Organization rules.
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