Trump Considering 25% Tax on European Cars Including MINIs

Mini plant oxford

This is new that could have a major impact on the cars we love. For decades the economic policy in the US has been to keep import tariffs low in support of free trade and economic growth. A quick look at the longterm data shows that that has worked tremendously for the US economy. But that may be changing. According to reports from the German publication Wirtschaftswoche, US President Donald Trump revealed to French President Macron that he intends to raise tariffs to 25% on all European cars in an effort to decimate European car sales in the United States.

The president’s reported disdain for luxury German automobiles, particularly Mercedes, is so strong that he’s said that the goal of this tariff would be to eliminate them from New York’s Fifth Avenue – an epicenter of wealth in New York City.

Lets not mince words here. A 25% tax on European cars might destroy MINI in the United States. Currently the US levies a 2.5% tariff on MINI and European cars. That means a $30,000 MINI has $750 of US tariffs on it currently meaning it’s actually $29,250 before entering the US. If Trump imposes this rumored plan that $29,250 MINI won’t be $30,000 anymore. It would be $37,038.

Think about that for a minute. Imagine a Mini Cooper S in signature trim with the premium package, alarm and garage door opener (you can see the full price list here). That car costs out the door $30,000 (including that current 2.5% tariff) That little MINI will now cost $37,038. For $37,038 you would get a moderately equipped MINI that would be hopelessly under equipped compared to its Asian and American competitors. It might still win in the fun to drive category but that price would be a huge hurdle for most people.

If prices were to be raised on MINI by 23.5%, it would not only kill sales in the US but it would almost immediately destroy thousands of American livelihoods at MINI dealers not to mention MINI USA corporate. What can be done? Unfortunately the president has direct authority to issue a tariff like this. However your voices can still be heard by contacting your elected officials and voicing your concern here and throughout the web.

  • “Unfortunately the president has direct authority to issue a tariff like this.”

    While this is true, final say in all matters of trade and treaty ultimately reside with Congress. Write your member of Congress to override the Office of the President and avert a trade war that will ultimately cost more jobs than it saves.

    • Thanks for clarifying.

      And yes there are a ton of economic models that show what you said is true. We hate to get into politics on MF but it’s hard to stay out of this one given its impact on MINI and also the obviousness of how bad an idea this is.

    • b-

      The GOP often don’t care what people want, party over country is the way they vote.

      Hey trump, instead of taxing superior automobiles perhaps “domestic” auto builders should build more appealing cars and trucks. Also, this stooge president doesn’t understand that “American” cars are full of parts made everywhere.

      • Scott Eaves

        I’d say that neither party actually cares what the people want. They care more about lining their own pockets.

    • Kurtster

      I think this trade tantrum is about to get a lot worse after the G7 shenanigans. Trump may retaliate against the forthcoming EU retaliatory sanctions on US goods, and ban the import of all German cars like he said he wanted to do with all Muslims except in this case a court isn’t going to stop him.

      This congress will also rubber stamp anything he wants, so buckle up. It’s likely to get very bumpy soon.

  • Mr Remi

    Maybe this is just the price of making America great again? You know, like before MINIs roamed the great state.

    (btw: all of the above was in my sarcastic voice)

  • Nick Dawson

    In the short term it’s not the solution to what is a global issue. Nonetheless, what President Trump has done is to force the issue, and this will concentrate minds to finally do something about the unfair and – in the long term – unsustainable US trade deficit with the rest of the world.

    DT has also promised the UK, that after it leaves the EU the US will negotiate some mutually advantageous trade deals. More MINIs built in the UK using components sourced in the UK is the way forward for BMW , provided that it has the political will to do so.

    • oldsbear

      If it was rocket science, Trump would declare it a hoax.

      • Nick Dawson

        Eligible US citizens will have the opportunity to vote on November 3, 2020. It’s called Democracy.

    • Nick Dawson

      In the meantime, according to Reuters, BMW said on Friday that it may increase the amount of steel it sources locally for its US plant after Washington imposed tariffs on imports of steel and aluminum from the European Union. BMW’s plant at Spartanburg, South Carolina, is its largest in the world, and sources more than 70 percent of its steel locally.

  • Don’t enjoy bringing politics into this discussion but have never been a fan of Trump, before his presidency and especially since he took offer. My reasons would take up too much space here. If we see a 25% tax on European autos as well as many other products, it would be a killer for the US dealerships, jobs, etc. that sell European vehicles. I’m on my 4th MINI since 2008. Add 25%, and my next MINI would be a very long time from now (or maybe never). Just the way I see it! But what about European vehicles that are made here in the US such as the BMW X3 & X5? Still get the 25%tax?

    • No they would be exempt.

      It’s also worth noting that BMW is the largest EXPORTER of automobiles from the US to the rest of the world.

      • I love using this fun little fact to stump anti-globalists…

  • Bean

    This just means I hang on to my European made cars longer and buy used when I need one. I don’t dislike American built cars- I have one as a company car, but I’d never buy one. The tariffs are not good news for the world- it’s going to become more hostile in the future. Remember folks without making this political, there are consequences for the choices we make. This is just one of many.

  • J P

    Wow, this is why America is fallen behind others, this board is full of millennial idiots who are completely ignorant abut trade, economic, negotiations, leverages, simple read between lines/common sense…just a bunch of brain washed sheep…sadly, this is why average American household owe 6000 or more credit debt, everything you consume is on payments, even for a simple $5 lunch…..keep it up kids, don’t bother to learn, get real world working experience by being an entrepreneur just mouth off like idiots and go to your pathetic hourly jobs, you are shackled by your ignorance and arrogance to learn, you are handcuffed by your liberal hate and your gender bending bs….that’s 99% of your knowledge, sadly you will never make it in life, so wait for the government cheese losers.

    • Kurtster

      You left out the customary, “GET OFF MY LAWN!”