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European companies are pursuing a financial goal from a potential trade war with the United States. Some top executives warn that the uncertainty about Donald Trump’s trade policy is already concerned with investment plans.
The US President Delayed steep tariffs Against Canada and Mexico at the beginning of this week, but still has the EU in the crosshairs and lets the managers guess the scope and effects of new taxes.
Markus Krebber, Managing Director of Germany’s RWE, one of the largest power producers in Europe, said that the risk of tariffs is slowing the investments of his group in wind and solar projects in the United States.
Potential import duties have great uncertainties about “what they achieve in the USA”, Krebber said at a conference this week.
Intermediate goods such as rotor blades and batteries have to be “imported because there is still no local production in the USA,” he added.
Some companies, including the luxury goods group LVMH and Oil Major Shell, were Consideration of the increase in your US presence. But Krebber said: “Our big customers all tell the (Trump) administration that she will have to guarantee certainty soon, because otherwise they actually achieve the opposite of what they want.”
In an indication of Goldman Sachs, analysts from Goldman Sachs said that it was not necessarily “.
The bank already expects some effects on trade barriers, whereby its 2025 share team is forecast to only 3 percent on European profit per share – far below the consensus forecasts of the analysts.
The EU is Preparation for concessions To avert a trade war with Trump, who complained that the Europeans do not buy our cars, they do not take our farm products, they take almost nothing and we take everything from them.
The block makes up about 15 percent of US imports, with machines, pharmaceuticals and chemicals being among its top exports to America. The European automotive sector is also exposed to tariffs, especially if the EU retaliates with taxes for US goods.
“The big question is what happens when these tariffs come between the USA and Europe,” said Jim Rowan, Managing Director of Volvo Cars.
Although it would be “manageable” if the USA increased tariffs for EU goods from 2.5 percent to 10 percent, a larger margin would force the company to increase production in its work in South Carolina, said Rowan this week .
The Swedish group warned this week of lower profitability this year, partly due to the uncertainty of the tariff. French beverage group Pernod Ricard too said it could be hit.
The beverage conflomerate Diagao, listed in London, predicted a $ 200 million profit from June if Trump carried out his endangered delivery of 25 percent for Mexican and Canadian imports.
Jan Rindbo, managing director of the Danish ship protection group north, warned that When the EU returned Companies would be “hit twice” against US tariffs with their own taxes. A trade war could lead to EU companies import some goods from further removal, such as from South America, he added.
Although the demand for a wider shipment area would be positive for the shipping sector, this could mean that the “US economy is hit that the EU economy will be met,” he said.
Despite the concerns, a number of managers said they had the flexibility to adapt to trade disorders. Energy companies could redirect liquefied natural gas to avoid duties between the United States and China, Patrick Pouyanné, Managing Director of France’s totalergies, said.
“The Chinese buy energy from companies like Total. In fact, they only asked us not to pay the (tariff), to give them an Australian or Qatar, and we will take the US LNG and send it to Europe elsewhere, ”he told the Financial Times.
ArcelorMittal, the second largest steel manufacturer in the world, contributed to the combat of potential US tariffs in Mexico and Canada. The Group’s Canadian company is a critical supplier for the US automotive sector, while its American facilities use semi-fine steel products from Mexico.
The Chief Financial Officer of Genuino Christino, Arcelormittal, said that he was “not excessively concerned” about the prospect of tariffs. The company, he said, achieved a goal of around $ 100 million per quarter in 2018 when Trump recently imposed 25 percent tariffs on steel. However, the higher costs were compensated for by higher prices.
Micael Johansson, Managing Director of Sweden Defense Master Saab, told the FT: “It is a bit early to understand where to go. Trade wars are good for no one. “
Reporting by Sylvia Pfeifer, Kana Inagaki, Oliver Telling and Clara Murray in London, Olaf Storbeck in Frankfurt, Ian Johnston in Paris and Richard Milne in Oslo