The European Union is poised to impose tariffs on Boeing aircraft and cars made in the U.S. This move is seen as a significant response to tariffs levied by the Trump administration on goods from the EU, should ongoing trade discussions fail to ease tensions across the Atlantic.
The proposed tariffs could affect around $114 billion worth of American products, including aerospace items. Reports suggest that a list detailing these products will be shared among EU nations this week, with the possibility of adjustments during a month-long consultation phase.
The extra fees on Boeing aircraft are intended as retaliation for the tariffs the U.S. has imposed on Airbus SE, the EU’s primary aircraft manufacturer. The EU aims to create a more balanced competitive landscape between these two aviation giants.
“Picture Europe negotiating, and if it doesn’t yield favorable results, additional tariffs on aircraft will follow,” stated Airbus CEO Guillaume Faury at a recent event in Paris.
Boeing, the leading manufacturing exporter in the U.S., may find itself increasingly vulnerable as ongoing trade conflicts, which began under President Trump, impact the dollar’s value.
Previously, Trump introduced sweeping taxes on European exports, including a 25% tariff on vehicles and metals, alongside a universal tariff that was initially set at 20%.
The European Commission has been in continued discussions with officials from the Trump administration, yet progress has been limited. Brussels officials estimate that the imposed tariffs could eventually encompass $599 billion in EU exports, a statement released on Tuesday noted.
A spokesperson for the European Commission refrained from commenting on the potential tariffs, while Boeing did not respond to requests for information.
The White House has also been approached for comments regarding the situation.
On Wall Street, Boeing’s stock remained relatively unchanged shortly after trading commenced on Wednesday.
“We are fully engaged in discussions with the U.S., viewing negotiated solutions as our clear preference,” remarked Commission spokesman Olof Gill. “However, we’re also preparing for the possibility that we might not reach an agreement with the U.S.,” he added.
Gill did not delve into specifics regarding ongoing discussions.
If transatlantic tariffs are enacted, Boeing could face significant repercussions for its operations. In 2023, U.S. aerospace exports to the EU amounted to $35.3 billion, with notable European customers such as Air France-KLM and Deutsche Lufthansa AG.
Uncertainty surrounding trade has prompted some airlines to warn about potentially declining to accept aircraft orders subjected to these additional fees. Ryan Air Holdings, Boeing’s largest European client, has been particularly vocal, with CEO Michael O’Leary noting last week that escalating costs could lead to the cancellation of a $33 billion order.
A spokesperson for Ryanair opted not to comment on the EU’s potential tariffs.
The EU is also preparing to target American-made vehicles with tariffs. Traditionally, under the 1979 World Trade Organization Agreement, commercial aircraft and their components have been exempt from duties, a status that faced challenges during the Trump administration due to heightened tariffs stemming from the long-standing Boeing-Airbus subsidies dispute, which were suspended in 2021.
The European Commission anticipates submitting a formal proposal to Washington later this week in a last-ditch effort to resume negotiations. This proposal will likely include suggestions to lower tariffs and non-tariff barriers while promoting EU investments in the U.S. economy.
