President Donald Trump has announced a new deadline for the European Union to finalize its trade agreement with the United States, setting July 4 as the target date. If the pact is not ratified by then, Trump warned that tariffs would "immediately jump to much higher levels." This comes after earlier threats to hike tariffs on auto imports as soon as this week if the EU failed to act.
Trump's Ultimatum
In a social media post on Thursday, Trump stated he had spoken with European Commission President Ursula von der Leyen and agreed to extend the deadline to America's 250th birthday. "I agreed to give her until our Country's 250th Birthday or, unfortunately, their Tariffs would immediately jump to much higher levels," the president wrote. He also accused the EU of not moving fast enough to implement the deal, which was originally reached in July 2025.
EU Response
Von der Leyen confirmed the conversation, posting that "both sides" remain "fully committed" to implementing the agreement. She noted that "good progress is being made towards tariff reduction by early July." The European Commission president also discussed other topics with Trump, including Middle East stability and preventing Iran from obtaining nuclear weapons.
Market Reaction
Automaker stocks, which had slipped on Trump's earlier threats, showed a muted response to the new announcement. U.S. shares of Stellantis NV fell 2.5 percent in New York trading Thursday, while U.S. depositary receipts of Volkswagen AG were little changed. The market appears to be waiting for concrete developments.
Background
The trade deal between the U.S. and EU has been long delayed, with Trump previously threatening to raise tariffs on European automobiles to 25 percent from 15 percent. The president expressed impatience, saying, "I've been waiting patiently for the EU to fulfill their side of the Historic Trade Deal." The new July 4 deadline adds urgency to ongoing negotiations.
