Trump threatens 'far larger' tariffs if EU and Canada unite to do 'economic harm' to the U.S.

U.S. President Donald Trump speaks to the media in the Oval Office at the White House in Washington, D.C., U.S., March 26, 2025.

U.S. President Donald Trump threatened to impose "far larger" tariffs on the European Union (EU) and Canada if they work together to combat trade tariffs.

"If the European Union works with Canada in order to do economic harm to the USA, large scale Tariffs, far larger than currently planned, will be placed on them both in order to protect the best friend that each of those two countries has ever had!," Trump said in a Truth Social update on Thursday.

On Wednesday, the White House leader had announced that he will set a 25% tariff on "all cars that are not made in the United States" with the levies due to take effect on April 2.

Trump White House aide Will Scharf said the new duties apply to "foreign-made cars and light trucks" and come in addition to tariffs that are already in place.

Crucially, the tariffs will also apply to car parts including engines, transmission and electrical components — many of which are shipped to the U.S. from abroad and used in American car production, although these are set to come into effect in May. Scharf estimated that the measures will result in "over $100 billion of new annual revenue" to the U.S.

Global markets were roiled as a new front opened in the burgeoning global trade war, with shares of U.S. and Asian automakers falling after the announcement, and European auto giants expected to do the same at the market open on Thursday.

Trump has already upended long-established global trading relationships by imposing import duties on goods coming from Mexico, Canada and China, as well as levies on all steel and aluminum imports, because of what he sees as unfair trade deficits that the U.S. has with a number of its largest trading partners.