The close transatlantic trade relations are under significant strain due to the tariff policy of US President Trump. This has already affected the export performance of German industry during the first three quarters of 2025.
The German Economic Institute (IW) has published a report on German export performance to the United States, which says that exports of goods from Germany to its main foreign partner have declined sharply in the first three quarters of this year, mainly due to increased import tariffs in the United States and problems related to a specific sector.
According to the analysis, the total volume of German exports of manufactured goods to the United States decreased by about 7.8 percent in the first three quarters of 2025 compared to the same period in 2024, which is the reverse of the average annual growth of about five percent seen between 2016 and 2024. This reduction reflects an increase in tariff barriers and, as a result, weak demand in key industries.
The report highlights that the value of exports of automobiles and auto parts decreased the most, by almost 14 percent, while exports of machinery and chemicals also declined significantly, by about 9.5 percent each, highlighting the broad impact of the tariff regime. These three sectors together account for more than two-thirds of the total decline in exports to the U.
S. market. Export volumes in most major sectors remain at or near 2022 levels, indicating a significant reduction in trade flows after several years of steady growth.
In the report, the decline in exports is mainly attributed to tariff policies on imports from the United States, including 50 percent duties on many steel and aluminum–related products for machinery and equipment exports, as well as increased tariffs on automobiles, which have created a new norm in transatlantic trade in goods. The study warns that a sustained recovery in German exports to the United States in the near term is unlikely unless tariff levels decrease.
The IW analysis highlights the challenges faced by German industry in maintaining global market share in the face of protectionist trade policies, and suggests that further adjustments to export strategies and market diversification may be needed to counteract the economic downturn.
Author: SteelOrbis Editorial Team
Steelorbis.com
