U.S. and EU spell out tariffs for autos, pharmaceuticals, and more

Several questions remained unanswered including on what tariff rate would apply to some goods U.S

Thierry Monasse | Getty ImagesSpeaking to journalists on Thursday after the announcement, EU Trade Commissioner Maros Sefcovic said that "this is the most favorable trade deal the U.S. has ext to any partner.""But this is not the end

This is the beginning

This framework is the first step, one that can grow over time to cover more sectors, imve market access, and strengthen our economic ties even further," he added.Europe balks at ‘unbalanced’ U.S. trade dealLumber, and regulation in the statement include the U.S. committing to "apply the higher of either the U.S

Most Favored Nation (MFN) tariff rate or a tariff rate of 15 percent, comprised of the MFN tariff and a recical tariff, on originating goods of the European Union."As of Sept. 1, the U.S. will apply only MFN duties on several goods from the EU, including "unavailable natural resources (including cork), all aircraft and aircraft parts, generic pharmaceuticals and their ingredients and chemical precursors."Several so-called Section 232 tariffs have been capped at the wider 15% tariff rate, including those on lumber, semiconductors and pharmaceuticals, according to a senior U.S. administration official

This is sharply below the rates Trump has sometimes threatened, as well as a 100% levy on semiconductors.Meanwhile, the statement noted that the EU intends to "to eliminate tariffs on all U.S. industrial goods and to vide preferential market access for a wide range of U.S. seafood and agricultural goods." This was already broadly covered in the initial framework.Trump is hailing the EU's $600 billion investment pledge — but it might never happenThe statement also included insights into the EU's energy purchasing and investment pledges, which previously raised questions their feasibility and potential repercussions if the commitments do not materialize.The announcement reiterated figures for planned spending from the EU, including on AI chips, energy, and broader investments in the U.S., but described them as int and expected, rather than as guaranteed commitments, a senior administration official pointed out.Thursday's statement also noted plans for the EU to "substantially" increase its curement of U.S. military and defense equipment, even as Europe has committed to growing its own defense capabilities.Trump's love affair with the EU's $750 billion energy mise is built on shaky groundNotably, the agreement does not introduce changes in terms of the EU's digital services act, which includes regulations for big companies and has long been a point of contention in trade talks for Trump.Sefcovic on Thursday noted that the digital sector had been kept out of trade talks.He also addressed questions regarding the wine and spirits sector, which is not covered by the deal

The EU's trade commissioner suggested that, while it would not be easy to come to an agreement on this issue with Washington, "these doors are not closed forever."PharmaEurope's pharmaceutical sector — the U.S.'s top source for pharma imports — will also see tariffs capped at up to 15%

Critically, the rate will not stack on top of other EU-wide tariffs.From Sept. 1, the Trump administration has also agreed to only apply its MFN drug pricing policy to generic pharmaceuticals

In recent weeks, Trump threatened levies as high as 250% on the pharma sector and sent an ultimatum to major firms demanding that they lower U.S. drugs prices.The White House leader has long lambasted the sector over what he has dubbed "abusive" pricing practices, while simultaneously urging firms to move their manufacturing operations stateside in an effort to bolster domestic duction.That mpted a flurry of U.S. investment commitments over recent months, including from Novartis, AstraZeneca and Roche, as well as pricing adjustments from Novo Nordisk and Eli Lilly.AutosCars are loaded onto the car carrier ship Polaris Liberty at the automotive terminal on August 11, 2025 in Bremerhaven, Germany

Focke Strangmann | Getty ImagesThe U.S. and EU on Thursday said they had agreed to a conditional 15% tariff for European autos and auto parts bound for the U.S. — but only after Brussels introduces legislation to reduce their industrial duties, according to a senior administration official.The official added that the mere introduction of EU legislation to reduce the rate of industrial tariffs would be enough to kickstart this trade-off."With respect to automobiles, the United States and the European Union intend to accept and vide mutual recognition to each other's standards," the U.S. and EU said in a joint statement published Thursday.Under the terms of the trade framework struck in late July, the EU said it would eliminate the "already low" duties on industrial goods from the U.S.Speaking late last month, Trump had hailed the initially disclosed framework agreement as the biggest trade deal ever made and one that mised to be "great for cars."The spect of a 15% tariff rate on autos and auto parts represents a substantial reduction from the U.S. president's threat to impose charges of 30%

It also nearly halves the existing tariff rate on Europe's auto sector from 27.5%.Industry groups had previously expressed deep concern the costs associated with the tariff reality.The German Association of the Automotive Industry (VDA), which represents more than 620 companies involved in the German auto sector, warned a U.S. tariff of 15% on auto ducts would "cost German automotive companies billions annually and place a burden on them in the midst of their transformation."