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As Trump threatens tariffs on all auto imports from Europe, the EU Says It Will Respond.

“If they decide to raise their import tariffs, we’ll have no choice, again, but to react,” EU Commission Vice President Jyrki Katainen told French newspaper Le Monde.

“We don’t want to fight (over trade) in public via Twitter. We should end the escalation,” he said in the comments published on Saturday.

How to End the Escalation

No one has figured out the obvious. The way to end the escalation is to stop responding!

Meanwhile, Trump has not figured out that Tariffs on European Cars Would Hurt US Auto Jobs.

German automakers Mercedes, BMW, and Volkswagen all have plants in southern states and directly employ more than 20,000 US workers between them, primarily at those factories. Volvo is just starting production at its first US plant in South Carolina.

BMW's largest plant in the world, in South Carolina, built 371,000 cars last year. It exported more than 70% of those cars to other countries. By contrast, BMW only imported 202,000 cars to the US from its German plants.

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And lower sales will cost jobs at car dealerships, which employ more people than the automakers' assembly plants. Let's look beyond autos.

Please consider Lobsters, Small-Batch Whiskey and Trump’s Trade War.

Nails

Mid Continent, the largest American producer of nails, imports steel from Mexico to make its nails. That steel is now subject to the 25 percent tariffs that Mr. Trump imposed on dozens of countries, forcing Mid Continent to raise its prices by nearly 20 percent.

Orders have plummeted by 50 percent this month as the company tries to compete with cheaper foreign-made nails. Those foreign manufacturers are not facing higher steel costs, giving them an advantage over Mid Continent.

The company, which employs about 500 workers, has already cut 60 jobs. It could potentially cut 200 more in the coming weeks.

Whiskey

To meet a global thirst for American whiskey in recent years, distilleries that make bourbon and rye — and sell it around the world — have sprung up across the country. But this week the European Union applied a 25 percent duty to American whiskey in response to Mr. Trump’s steel tariffs, spiking the prices of the iconic American tipple on the Continent.

For small distillers like Scott Harris, a founder of Catoctin Creek Distillery in Purcellville, Va., this has dampened happy hour.

“We are just launching into the European market now in a big way, and this could be the worst possible timing for us,” Mr. Harris said. “We’re probably going to see all of our European sales now come to a screeching halt.”