US-EU Trade Deal: Winners and Losers Emerge from Historic Agreement

The United States and the European Union have announced what has been hailed as the largest trade deal in history, following negotiations in Scotland. While the agreement is more a framework than a fully detailed pact, key elements revealed by US President Donald Trump and EU Commission President Ursula von der Leyen provide insight into who stands to gain—and who may bear the costs.

### Winners

**Donald Trump** President Trump has secured a landmark trade deal, delivering on his promise to forge new agreements with major global partners. Analysts at Capital Economics estimate the deal could boost US coffers by tens of billions through import tariffs, though the shine of this victory may fade if upcoming economic data—on inflation, jobs, growth, and consumer confidence—reveals adverse effects from his tariff policies. **Stock Markets** Global markets responded positively, with Asian and European indices rising on Monday after the deal’s announcement. The 15% tariff on EU goods, lower than feared, provides investors with certainty. Chris Weston of Pepperstone told AFP the agreement is “market-friendly” and could strengthen the euro. **US Carmakers**

Both US and EU aviation sectors are winners, with aircraft, plane parts, certain chemicals, and some agricultural products exempt from tariffs. This ensures frictionless trade for these strategic industries, with the EU pushing for more “zero-for-zero” deals, including for wines and spirits.

American car manufacturers benefit from the EU slashing its tariff on US-made cars from 10% to 2.5%, potentially boosting exports to Europe. However, complexities arise as many US-branded vehicles are assembled in Canada or Mexico, facing a higher 25% US import tariff, which could undermine domestic competitiveness. **US Energy Sector** The EU has committed to purchasing $750 billion (£558bn, €638bn) in US energy, including liquified natural gas (LNG), oil, and nuclear fuels, alongside $600 billion in broader investments. This shift strengthens US energy exports, particularly as Europe reduces reliance on Russian gas amid the Ukraine conflict. **Aviation Industry (US and EU)** ### Losers **US Consumers** American consumers, already grappling with rising living costs, face higher prices on EU goods due to the new 15% tariff. While lower than initially feared, this tax—added to the cost of imported products—will likely be passed on by importers, increasing the cost of everything from European cars to luxury goods. **European Solidarity** The deal has exposed cracks in EU unity, as all 27 member states must ratify it. While some cautiously welcomed the agreement, others, including French Prime Minister François Bayrou, called it a “dark day” for the EU’s values and interests. Hungary’s Viktor Orban was more blunt, claiming Trump “ate von der Leyen for breakfast.” These divisions complicate the EU’s response to other challenges, such as the war in Ukraine. **German Carmakers** Germany, home to automotive giants like Volkswagen, Mercedes, and BMW, faces challenges despite the EU car tariff dropping from 27.5% to 15%. The German carmakers’ trade body, VDA, warned that the remaining tariff will cost the industry billions annually. Chancellor Friedrich Merz acknowledged the deal’s benefits but expressed disappointment at the lack of further trade easing. **EU Pharmaceuticals** Uncertainty surrounds the tariff rate on European pharmaceuticals entering the US. While Trump claimed drugs were excluded from the 15% tariff, von der Leyen and a White House source confirmed their inclusion, dashing hopes for a full exemption. This could impact major EU pharma exports like Denmark’s Ozempic, with Ireland’s opposition highlighting the sector’s vulnerability to this uncertainty. ### A Mixed Outcome The deal marks a significant win for Trump, delivering economic and political gains, but it falls short of a complete victory for the EU. While the agreement stabilizes transatlantic trade, it imposes costs on European exporters and American consumers. As details are finalized and economic data emerges, the true impact of this historic framework will become clearer.