While earlier Europe said that it would disclose its trade war retaliation strategy no sooner than March 5, moments ago Reuters floated its latest trial balloon reporting that the European Union is considering applying a 25% tariffs on roughly $3.5 billion of imports from the United States should Trump execute his plan steel and aluminium tariffs.
While the European Commission has said it would respond "firmly" to proposed U.S. import duties, it also warned it would join others in a challenge at the World Trade Organization and consider safeguard measures, last deployed in 2002, to guard against steel and aluminium being diverted to Europe from elsewhere if U.S. tariffs come in.
Separately, the WSJ reports that the EU will target motorcycles, and Harley Davidson in particular, bourbon and blue jeans in retaliation.
The "bloc will react to the proposed U.S. steel action with tariffs on motorcycles (Harley-Davidson), bourbon whiskey and blue jeans,” WSJ reporter William Mauldin cites EU President Jean-Claude Juncker as saying in Twitter post.
Breaking: EU's Juncker says the bloc will react to the proposed U.S. steel action with tariffs on motorcycles (Harley-Davidson), bourbon whiskey and blue jeans.— William Mauldin (@willmauldin) March 2, 2018
Juncker told TV journalists in Hamburg that Europe needs trade policy that is able to defend, and "we will not be naive," according to Juncker’s spokeswoman Mina Andreeva’s tweet.
While Europe's response to US bourbon had been leaked previously, the attack on Harley Davidson is new, and with its base in Wisconsin, some have suggested this is an attempt to target swing states.
The response in HOG stock was immediate.
That said, with just 6,400 HOG employees, the impact will likely be modest.