Donald Trump has threatened to “apply a tax” on cars imported from the EU.
The US president cited a “big trade imbalance!” and said the EU made it “impossible of our cars (and more) to sell there”.
He tweeted:
Cabinet Office minister David Lidington told BBC One’s Sunday Politics programme: “I just think that the United States is not taking an advisable course in threatening a trade war.
“Trade wars don’t do anybody any good.”
According to the BBC, the US is the largest export market for EU cars - 25% of
It came after Trump set out plans for steel imports to face a increased 25% tariff and aluminium 10%, although White House officials later were later forced to backtrack, saying some details still needed to be ironed out.
The European Union has indicated it could retaliate, potentially starting a trade war with the US.
European Commission president Jean-Claude Juncker said: “We will not sit idly while our industry is hit with unfair measures that put thousands of European jobs at risk.
“I had the occasion to say that the EU would react adequately and that’s what we will do.
“The EU will react firmly and commensurately to defend our interests. The Commission will bring forward in the next few days a proposal for WTO-compatible counter-measures against the US to rebalance the situation.”
Juncker said US products, such as Levi’s jeans and Harley-Davidson motorcycles, would be treated “the same way” the US planned to handle tariffs on European metals.
The industry trade body warned such tariffs would have “significant impact” on the UK.