Consultation held with the Commission on the proposed directive safeguarding workers from ionising radiation risks.
German companies in the region of Lower Saxony are approaching the new EU-US trade deal with a mix of optimism and concern, as the agreement includes a 15% tariff on most EU exports, albeit with reduced tariffs in the automotive sector from 27.5%.
This reduction offers some relief to key industries like automotive, mechanical engineering, metal industry, chemistry and plastics, and electronics, all significant contributors to Lower Saxony's economy. However, the tariffs remain a source of worry for many companies, with over 70% expecting additional burdens from the agreement.
Industrial groups such as the BDI federation and the chemical trade association VCI have voiced strong opposition, arguing that the tariffs are too high and pose risks to business viability and transatlantic economic relations.
The automotive sector, a crucial part of Lower Saxony's economy, is feeling the pressure from US tariffs and increased production costs. Volkswagen, a key player in this sector, has reported a profit decline partly due to tariffs and competitive challenges. This situation affects related sectors like mechanical engineering and electronics, as these industries are tightly integrated in supply chains and production networks related to automotive.
Despite the challenges, Andreas Eckstein, Managing Director of Invest in Niedersachsen (Lower Saxony), emphasises ongoing transatlantic opportunities. His comments suggest that regional companies and investment bodies are seeking ways to adapt and capitalise on the trade relationship beyond tariffs alone.
The Chamber of Industry and Commerce (IHK) Hanover conducted a survey of 122 export-oriented companies in Lower Saxony, revealing that approximately 90% of the companies expect negative impacts from the trade agreement. Around 60% of the companies plan to pass on tariff costs directly, while 27% are considering it.
The new start date for the implementation of the agreement is set for Thursday, August 7, after a postponement from the original date of August 1. The EU Commission is expected to continue negotiating with a focus on reliability and economic improvements in a freer transatlantic trade in the coming weeks.
Mirko-Daniel Hoppe, deputy CEO of IHK Hanover, emphasised the need for companies to have sufficient planning security, as the tariff compromise is not yet guaranteed. He also highlighted the additional burden the trade deal will demand for many export companies in the region.
The trade agreement was reached after lengthy negotiations between US President Donald Trump and EU Commission President Ursula von der Leyen. The tire manufacturer Continental from Hanover, for instance, has announced its intention to produce more in the USA due to tariffs, as some of the tires sold there have been imported from Europe.
In conclusion, German companies in Lower Saxony across various sectors are responding with cautious optimism: while the trade deal offers some tariff relief, significant concerns remain about tariff levels and their impact. Industry leaders and local officials are advocating close monitoring and strategic adjustment to protect competitiveness in the transatlantic market.
[1] Bild [2] Handelsblatt [3] NDR [4] IHK Hanover [5] Invest in Niedersachsen
- The trade agreement has sparked concerns in the financial sector, as over 70% of companies surveyed expect additional burdens from the deal, with many planning to pass on tariff costs directly.
- The automotive sector, a significant contributor to Lower Saxony's economy, is particularly affected by the US tariffs and increased production costs, potentially leading to financial implications for related industries like mechanical engineering and electronics.
