BMW CEO Optimistic About EU-US Trade Agreement on Car Tariffs

According to Reuters, on July 11, BMW Group CEO Oliver Zipse expressed optimism regarding an imminent 'manageable' agreement between the EU and the US concerning import car tariffs. This agreement may include a mechanism to offset imports through exports. Zipse made these comments during a company event in Munich, as the EU awaits a letter from the US government that may outline the framework of a trade agreement and specify the tariff rates on EU car exports. On July 10, US President Trump stated that the EU could receive a letter regarding tariff rates by July 11. Zipse stated, 'I am optimistic that we will end up with a manageable situation, but the results are still to be seen.' He noted that the agreement could include a 'net settlement mechanism' allowing US exports to offset import quotas, which would benefit BMW due to its largest production base located in Spartanburg, South Carolina. Zipse mentioned that this mechanism may be based on the value of goods exported from the US market overseas (for instance, BMW's value for 2024 is expected to exceed $10 billion), rather than the number of vehicles exported. Insiders have indicated that if the EU and the US reach an agreement on this mechanism, imports of automotive parts may also benefit. Zipse remarked, 'We have an important advantage—BMW is the largest car exporter from the US.' He cited data showing that BMW is expected to export 225,000 cars from the US in 2024. Currently, high tariffs on imported cars are forcing European manufacturers to respond urgently. Meanwhile, automakers hope that the US government and the European Commission can negotiate an agreement to minimize the impact of tariffs. Earlier this week, insiders informed Reuters that the EU has proposed a package of measures to the US to alleviate pressure, including offering export and investment credits, as well as mutually reducing existing tariff rates.