![\"EU\u2013US](\"https:\/\/static.toiimg.com\/thumb\/msid-132159465,imgsize-1055010,width-400,height-225,resizemode-4\/us-eu-trade.jpg\" "\\"File")
<\/div>\n<\/div>\n<\/div>\nTrade in goods between the European Union and the United States reached a record \u20ac875 billion ($1.00 trillion) last year despite tariffs, but a new study has warned that the headline figures mask significant underlying economic strain, particularly for Germany\u2019s automotive sector.The research by the German Economic Institute (IW) found that EU exports to the US rose 7.7% to \u20ac580 billion, while US exports to the EU increased 2.2% to \u20ac295 billion.This pushed the EU\u2019s overall goods trade surplus with the United States to nearly \u20ac285 billion, as per Reuters.“This first impression is misleading,” IW economist Samina Sultan said, highlighting that the apparent strength in trade flows was partly driven by front-loading of shipments ahead of tariff increases that came into effect in April.<\/p>\n Despite the overall growth in trade volumes, European manufacturing, especially the auto industry, faced notable pressure. EU exports of cars and automotive parts to the United States fell 20.4% in 2025, according to the study.Germany, which accounts for nearly two-thirds of EU auto exports to the US, recorded an 18.9% drop in shipments.The decline underscores the sector-specific impact of tariff-related disruptions even as aggregate trade numbers remain strong.<\/p>\n Not all EU economies followed the downward trend. Ireland posted a 52.7% surge in exports to the US, driven largely by tariff-exempt pharmaceutical and chemical products, the study found.Other countries that recorded export growth included the Czech Republic (+5.1%), Italy (+7.2%), Denmark (+10.6%) and Finland (+10.8%), while most other EU member states saw declines in exports to the US.<\/p>\n Transatlantic services trade also reached a record \u20ac865 billion, although the EU ran a \u20ac178 billion deficit in this segment.Intellectual property payments\u2014covering software licences, patents and trademarks\u2014accounted for more than 40% of EU service imports from the United States, rising 13.7%. The report noted that while services have largely escaped direct tariff impacts, the broader trade conflict has still affected flows.EU imports of US travel services fell by around 8%, a decline attributed to fewer European tourists visiting the United States last year.The IW study also said that the Turnberry trade deal between the EU and the US has asymmetrically benefited Washington, although it remains a workable arrangement that should be maintained by both sides.“New tariff threats would cause new uncertainty that only hampers business activities on both sides of the Atlantic,” the institute warned.The findings come amid ongoing efforts to stabilise transatlantic trade relations, with policymakers on both sides seeking to balance industrial competitiveness with tariff-related pressures.<\/div>\nGerman auto sector faces sharp decline<\/b><\/h2>\n<\/p>\n
Ireland offsets regional weakness<\/b><\/h2>\n<\/p>\n
Services trade also hits record levels<\/b><\/h2>\n<\/p>\n