Trump 2.0: Red alert for German industry!

Trump 2.0: Red alert for German industry!

Donald Trump's return to the White House has put German industry on alert. The Republican's election could prove to be a turning point for the economy, as Trump announced during the campaign that he would impose tariffs on imported goods. This could have catastrophic consequences for Germany, which relies heavily on exports. According to a report by German business news The leading representatives of the German economy are concerned that the announced tariffs will further burden the already struggling industry.

The concerns are not unfounded. The Federation of German Industries (BDI) warns that nationwide tariffs of up to 20 percent on all imports and even 60 percent on imports from China would massively damage not only Germany, but also the US economy. This assessment is supported by the employer-related Institute of the German Economy (IW), which predicts an impending trade war that could cost the German economy up to 180 billion euros over the next four years Legal Tribune Online reported.

Protectionism and its consequences

Trump's return could herald a harsher tone in transatlantic relations. The BDI speaks of an “epochal change” that will test the competitiveness of Germany and Europe. The chemical industry is even calling for free trade agreements and partnerships with other regions of the world to counteract the threat of trade restrictions. Economists warn that the tariffs not only make German goods more expensive in the USA, but could also lead to counter-tariffs from the EU, which would further burden foreign trade.

The stock markets are already reacting to the uncertainty: While shares in the German automotive sector are falling sharply, companies like Tesla, which are close to Trump, are recording price gains. Car manufacturers Mercedes-Benz, BMW and Porsche are facing losses of up to six percent, while Tesla is up more than twelve percent in premarket trading.

The future of transatlantic relations

The question remains how transatlantic relations will develop under Trump. The BGA emphasizes that the USA is Germany's most important trading partner and appeals for a continuation of the traditionally good relations. Laurenz Tohlen from the Noerr law firm sees both risks and opportunities in Trump's policies. While protectionist economic policies could seriously disrupt business, lower corporate taxes could make the USA more attractive for German investors.

German industry faces an uncertain future. The coming months will be crucial to see how trade relations develop and what measures Trump will actually implement. The fear of a trade war is real and companies must prepare for all eventualities.