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Trump Sees 50-50 Chance for EU Trade Deal After Japan Tariff Framework

U.S. automakers warn the Japan accord leaves them at a disadvantage under steeper steel, aluminum and parts levies

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A worker harvests oranges on a farm in Formoso, state of Minas Gerais, Brazil July 16, 2025. REUTERS/Adriano Machado
President Donald Trump speaks with reporters before departing on Marine One from the South Lawn of the White House, Friday, July 25, 2025, in Washington. The president is travelling to Scotland.
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Overview

  • The U.S. and Japan struck a provisional deal on July 22 that sets a 15% tariff on Japanese imports down from a threatened 25% in exchange for $550 billion in Japanese investment in U.S. projects.
  • U.S. automakers say the framework advantages Japanese producers by maintaining 50% duties on steel and aluminum and a 25% tariff on parts and finished vehicles.
  • EU diplomats report they are close to a similar agreement to cap U.S. tariffs on EU goods at 15%, prompting member states to approve €93 billion in retaliatory duties effective August 7 if talks collapse.
  • President Trump said July 25 that he sees roughly a 50% chance of sealing a deal with Brussels and intends to send letters to nearly 200 countries to formalize negotiated tariff rates.
  • A self-imposed August 1 deadline will trigger the escalation of U.S. levies to 30% on EU imports and other trading partners unless agreements are finalized.