- Trump threatened a 50% tariff on EU goods and a 25% levy on iPhones unless Apple moves production to the U.S.
- The announcements rattled markets, with the S&P 500, Nasdaq, and European shares all sliding over 1%.
- EU trade talks have stalled, and analysts warn tariffs could raise prices on everything from cars to olive oil.
President Trump lit up global markets on Friday with not one, but two aggressive trade threats—first, a 50% tariff on all goods from the European Union starting June 1, and second, a 25% levy on Apple’s iPhones unless the company starts building them in the U.S.
The announcement, made on Truth Social, came just as markets had started to breathe a little after weeks of de-escalation. But that calm didn’t last long. Within minutes, the S&P 500 dropped 1%, the Nasdaq fell 1.2%, and European sharbes slipped 1.5%.
Trade Talks Stalling—and Trump’s Done Waiting
The EU threat seems to stem from the White House’s growing frustration that talks with Brussels are, well, dragging. “Our discussions with them are going nowhere!” Trump posted. He also accused the EU of existing mainly “to take advantage of the United States on TRADE.”
U.S. Treasury Secretary Scott Bessent echoed the frustration, saying on Fox News that the move was meant to “light a fire under the EU.” Meanwhile, EU trade chief Maros Sefcovic was expected to speak with U.S. Trade Rep Jamieson Greer later that day, though no updates had been released at press time.
Over in The Hague, Dutch PM Dick Schoof shrugged it off, calling it likely just another “move in the negotiation dance.” Still, EU envoys met in Brussels Friday to talk trade strategy.
Apple’s in the Hot Seat—Again
Trump also used the opportunity to take another shot at Apple, warning he could hit all iPhones sold in the U.S. with a 25% import tax unless they start manufacturing in the States. “I’ve told Tim Cook already,” Trump posted. “No more iPhones from India or wherever—they should be made here, in America.”
Apple, for its part, stayed quiet. The company has been slowly shifting some production to India and committed to a $500 billion U.S. investment—but that doesn’t include domestic iPhone manufacturing.
Legal experts say it’s unclear whether Trump can even do what he’s threatening. “There’s no direct authority for company-specific tariffs,” said Sally Stewart Liang of Akin Gump. “They’d have to use emergency powers or go through lengthy trade investigations.” Either way, Apple shares still dropped 2.5% on the day.
Markets React, Analysts Cautious
Trump’s tariff volley comes just weeks after he paused most of the April-announced “Liberation Day” tariffs, which had targeted nearly every country on Earth. He kept a 10% base tariff and scaled down a massive 145% tariff on China to 30%, partly in response to fentanyl concerns.
Citigroup’s chief economist Nathan Sheets summed up the nervous mood: “We might still get a deal here, but if there’s one region that makes me sweat—it’s the EU.”
A 50% tariff could slam consumer prices across the board—German cars, French wine, Italian olive oil, you name it. The EU shipped around €500 billion in goods to the U.S. last year, led by Germany, Ireland, and Italy. Big industries like pharma, cars, chemicals, and aircraft are all in the danger zone.
Volvo’s CEO Hakan Samuelsson added that if tariffs happen, consumers will foot the bill. “The smallest cars? We might not be able to bring those to the U.S. at all.”
But despite all the back-and-forth, he’s still holding out hope: “It doesn’t benefit anyone if trade between the U.S. and Europe shuts down. It’s just bad business.”
