One Step Forward, Two Steps Back? Deal Eases Auto Tension But Solidifies Broader Tariffs

The US-EU trade deal is being viewed by many as a case of “one step forward, two steps back.” While it takes a crucial step forward by creating a path to ease the auto tariff dispute, it takes two steps back by solidifying a broad 15% tariff on many other goods and by damaging the trust at the heart of the transatlantic relationship.
The step forward is undeniable. The framework provides a mechanism to de-escalate the most dangerous trade conflict between the two economic giants, offering a lifeline to the European auto industry and averting a potentially catastrophic tariff war.
However, the steps back are significant. First, the deal establishes a 15% tariff as the new normal for a vast range of products, from pharmaceuticals to food, representing a major move towards protectionism compared to the previous status quo. Second, the coercive way the deal was reached—with the US leveraging threats—has been described as a “submission” in Europe, eroding the spirit of partnership and setting a negative precedent.
This mixed result has led to a deeply ambivalent reaction. While commentators acknowledge the importance of averting the immediate crisis, there is a growing concern that in solving one problem, the deal has created or entrenched several others, leaving the long-term health of the US-EU trade relationship in a more precarious state than before.