Donald Trump’s latest round of tariffs appears to employ a divide-and-conquer strategy, testing European unity by hitting various countries and sectors with different levels of pressure. While the UK’s pharmaceutical industry faces a potential 100% duty, German truck makers are contending with a 25% levy, and other EU members are nervously watching a US investigation into medical devices.
This targeted approach creates distinct challenges for different nations. The UK is in a particularly tight spot because its pharmaceutical sector was not covered by a previous US trade deal, leaving it completely exposed. London is now forced to negotiate from a position of weakness, with a government spokesperson confirming “active engagement” with Washington to mitigate the damage.
The European Union, in contrast, feels it has a degree of protection through its 15% blanket tariff agreement, which a spokesperson described as an “insurance policy.” However, this policy is now facing a stress test. The new US probe into medical devices, a major EU export, suggests Washington is looking for new ways to apply pressure outside the scope of the existing deal.
The strategy of creating winners and losers extends to the corporate level. Analysts believe the tariffs are designed to spare companies that have invested in US manufacturing facilities. This could create a division between firms that have onshored production, like Roche and Novartis, and those that have not, effectively rewarding companies that align with Trump’s “America First” agenda.
This tactical approach puts European leaders in a difficult position. A unified response is complicated when the impact is not uniform across all member states and industries. The German auto industry’s vocal opposition to the truck tariffs highlights a specific national interest, while the UK’s pharma crisis is its own unique problem. This fragmentation could weaken Europe’s collective bargaining power in the face of sustained US pressure.