The threat of higher US tariffs on European cars and trucks is raising alarm in Germany and adding to pressure on the Dutch economy. While the Netherlands is not facing broad US sanctions, recent developments show how trade policy, export controls and targeted measures can still hit European industry hard.
The German economic institute IFO has warned that a new trade war could push Germany into recession in 2026. Chairman Clemens Fuest said the country faces serious risks if the United States follows through on plans to raise import duties on cars and trucks from the European Union to 25 percent.
US tariffs create new risks for Germany
US President Donald Trump announced the higher tariff rate on Friday. He insisted that the European Union is not complying with the trade deal reached in the summer of 2025. It is not yet clear what specific commitments Washington says were breached.
The warning from Ifo matters because Germany’s auto sector is highly exposed to the US market. Brands such as Porsche, BMW and Mercedes-Benz rely heavily on American demand, and a tariff increase could weaken exports, raise costs and hurt growth.
The German automotive industry association VDA has urged the US and the EU to return to talks quickly and honour the trade agreement. The group says the higher tariff would be extremely expensive and could also lead to higher prices for consumers in the United States.
The Dutch economy is also vulnerable
The Netherlands is not the direct target of a broad US sanctions regime. However, it remains exposed to the broader fallout from US trade policy. As a small open economy, the country depends heavily on international trade, supply chains and strong industrial demand from nearby European markets.
That makes the Dutch economy vulnerable if Germany slows down or if global trade weakens further. A recession in Germany would likely affect Dutch exporters, logistics companies and manufacturers linked to cross-border production chains.
ASML, ICC and export controls
The pressure on the Netherlands is coming through specific channels rather than country-wide sanctions. One major issue is the International Criminal Court in The Hague, which has faced US sanctions against officials and staff. Another is export controls affecting advanced semiconductor technology, including restrictions that influence ASML’s business with China.
These measures are better described as targeted sanctions, export restrictions, and trade pressure, rather than general sanctions against the Netherlands. Still, they have real economic and political consequences for Dutch industry.
Brainport implications
For Brainport, the combination of tariffs, export controls and weakening German demand is especially important. The region’s technology and manufacturing sectors are deeply tied to international markets, making them sensitive to political decisions in Washington, Brussels and Berlin.
That is why the latest tariff threat is more than a diplomatic dispute. It is a direct business risk for the Dutch high-tech ecosystem, including companies, suppliers and workers in and around Eindhoven
NEWS BRAINPORT
