The European Union is trying to calm a brewing trade storm with Washington—but it’s not showing up empty-handed. In a bid to keep talks alive with the Trump administration, EU officials have circulated a revamped trade proposal that checks several US boxes: gradual tariff cuts on industrial goods, stronger labor and environmental safeguards, and joint projects in digital infrastructure, AI, and energy. The message? Brussels is open for business, but it wants something fair and balanced.
Behind the scenes, however, the EU is also sharpening its knives. If Trump pushes forward with new tariffs—especially his planned 25% duties on cars, chips, or pharma—the EU is ready to retaliate with €95 billion ($108 billion) worth of countermeasures. Officials have already delayed a separate round of tariffs in response to Trump’s steel and aluminum levies, but that 90-day grace period is ticking. Some member states are even pushing for immediate retaliation if the US hits European aircraft parts or digital services next.
At its core, this is about control. EU officials have rejected what they see as unilateral demands from the US that threaten the bloc’s autonomy over regulations and tax policy. They’re drawing a line at America’s push on digital rules and VAT, while still signaling they want to find common ground—offering cooperation on supply chain resilience, raw materials, and semiconductor overcapacity. Political-level meetings are expected next month, but with €100 billion in tariffs locked and loaded, this dance could still turn into a slugfest.