As trade negotiations intensify, the United States has signaled that it will not let up on its August 1 deadline for imposing higher tariffs on European Union imports, even as the EU attempts to secure a deal in time.
Over the weekend, US commerce secretary Howard Lutnick said he was confident a trade deal could be struck with the European Union but warned that the deadline for a baseline 30% tariff is fixed.
“That’s a hard deadline, so on August 1, the new tariff rates will come in,” Lutnick said Sunday on CBS News when asked about the deadline for his EU tariffs.
He did suggest, however, that talks could continue beyond that date. “These are the two biggest trading partners in the world, talking to each other. We’ll get a deal done. I am confident we’ll get a deal done,” he added.
“Nothing stops countries from talking to us after August 1, but they’re going to start paying the tariffs on August 1,” Lutnick said.
The EU has said it is preparing retaliatory measures against the US if the trade tariffs go into effect. Lutnick denied that the EU would target products like Kentucky bourbon and Boeing aircraft, stating that "they're just not going to do that."
Last-ditch talks are ongoing, with the EU hoping to negotiate a lower tariff rate. The bloc had aimed for a deal like the one signed by the UK, which was the first to reach an agreement with the US. That pact includes a 10% baseline tariff, with specific caveats for cars, steel, and aerospace imports.
However, analysts are skeptical that the EU can reach a similar outcome. The EU’s relationship with US President Donald Trump has been more contentious than the UK’s, as Trump has repeatedly criticized what he sees as an imbalanced trade relationship and unfair practices, a view the EU disputes.
The European Council estimates that in 2024, trade between the US and the EU totaled €1.68 trillion ($1.96 trillion). The EU reported a deficit in services but a surplus in products, resulting in a trade surplus of almost €50 billion.
The outcome of the US-EU negotiations is still up in the air, and the deadline of August 1 is drawing near. Tariffs seem certain to go into force unless a breakthrough occurs in the next few days, notwithstanding Lutnick's continued optimism about a compromise.
