EU-U.S. customs deal delivers mixed results for European exporters
A recent study has revealed uneven impacts from the EU-U.S. customs agreement, with some sectors facing higher costs while others gain advantages. Between April 2025 and February 2026, the average U.S. tariff on EU imports stood at 7.8 percent—far below the 37 percent levied on Chinese goods. Yet within the EU, German exporters and machinery producers have experienced mixed results from the deal. The EU-U.S. agreement initially lowered tariffs for many European exporters. Germany, in particular, saw its average tariff rate drop to 10.6 percent, down from the broader EU average of 8.2 percent. This shift gave German businesses a stronger position against Asian competitors, especially in the automotive sector, where duties fell.
However, machinery manufacturers faced unexpected challenges. The U.S. government reclassified certain machinery with high steel content as steel products, imposing a 50 percent tariff. As a result, the EU’s average tariff rate for machinery climbed to 12.6 percent. Economist Samina Sultan of the IW institute criticised the move, arguing it undermined the agreement’s purpose. She urged both sides to renegotiate terms quickly. The deal has still provided the EU with a competitive edge over Asian rivals in key industries. Yet the uneven application of tariffs has left some sectors, particularly machinery producers, at a disadvantage.
The EU-U.S. customs deal has created a split outcome for European businesses. While German exporters and automakers enjoy reduced tariffs, machinery producers now face significantly higher costs. The disparity has prompted calls for a review of the agreement to address its unintended consequences.
