BURSTPresident Trump on Friday revived his trade war, threatening to slap hefty tariffs on the European Union (E.U.) and to hit Apple with tariffs if it doesn’t manufacture in the United States.
His moves represented an about-face after weeks in which markets had rallied to Trump’s pausing of his “Liberation Day” tariffs on much of the world, and his lowering of tariffs on China.
The pause in the trade war also appeared to coincide with an uptick in Trump’s approval ratings, which well underwater had gone up from their depths in the immediate aftermath of “Liberation Day.”
It is too early to say how his new threats on iPhones, Apple and Europe will impact the views of voters, but stock markets were not amused.
The Dow Jones Industrial Average, S&P 500 and Nasdaq all opened down and ended in the red.
Trump signaled the shift in a series of messages on his preferred social media platform, Truth Social.
He threatened to hit the European Union with 50 percent tariffs, more than double what he threatened on Liberation Day, and to impose a 25 percent tariff on Apple. Later in the day, he made it clear that tariffs would be imposed on any cell phones made overseas.
The moves came one day after the House approved Trump’s massive “big, beautiful bill” of tax cuts and other measures.
Some sources expressed surprise at the decision.
“It’s almost like he was unattended without [Treasury Secretary] Scott Bessent. And like, what’s the purpose of this?” a source close to the White House said.
“It’s a shame really that a POTUS who wants desperately to be good for business has none of the temperament of a successful business leader or Fortune 500 CEO. He is permanently stuck in the ‘f----it, let’s see what happens mode,’” a former Commerce official in Trump’s first term said.
Trump said on Friday that the E.U. “has been very difficult to deal with” and that discussions are “going nowhere” so he recommended 50 percent tariffs starting on June 1.
“Right now, it’s going on on June 1. And that’s the way it is. No, they haven’t treated us properly, they haven’t treated our country properly,” he later told reporters.
The president added he just had decided it’s time to be tougher on the E.U.
“I just said, it’s time that we play the game the way I know how to play the game,” Trump said. “They’ve taken advantage of other people representing this country and they’re not going to do that any longer.”
Bessent said on Fox News Channel’s “America’s Newsroom” that trade negotiations are moving ahead with Asian countries, without any new announcements, but Trump’s move is “in response just to the E.U.’s pace.”
“Well, I'm not going to negotiate on T.V., but I would hope that this would light a fire under the E.U.,” Bessent added.
The administration had just announced a deal with China to lower tariffs from 30 percent to 145 percent and the reaction to that may have impacted Trump’s decision to go after the E.U. on Friday, the source close to the White House said.
“There’s at least some argument that with China, he took down the fists, right? He was ready for battle then like, well, okay, we got to a detent or a peaceful hold. And maybe he feels like he needs to make his bone somewhere else. Because Trump doesn’t like to lose. And I think there’s some chatter that with China, he blinked first,” the source said.
Meanwhile, the focus on Apple had been brewing after Trump called out CEO Tim Cook last week for “building all over India.” He has repeatedly called on companies to move manufacturing to the U.S. as a way to avoid tariffs.
Apple produces the vast majority of its products in China but has increasingly sought to diversify its supply chain, moving manufacturing to India and Vietnam and announcing plans to spend $500 billion in the U.S. over the next four years, including building a new factory in Texas.
Trump said he told Cook that the iPhone has to be made in the U.S. and expressed confidence Apple can build products at home. He said the 25 percent tariff would be imposed at the end of June and that it would also impact Samsung because they make a similar product.
“I had an understanding with Tim that he wouldn’t be doing this. He said he’s going to India to build plants. I said, ‘that’s okay to go to India but you’re not going to sell into here without tariffs’ and that’s the way it is,” Trump said.
“The iPhone, if they’re going to sell it in America, I want it to be built in the United States,” he added.
The former Commerce official in Trump's first term chalked up the new tariff threats to the president's lack of discipline and lack of understanding about what economic uncertainty does to companies.
“I think it’s also another example of someone whose only business experience comes from being in a closely held family business, with little to no exposure in the ups and downs of the market, being responsible for shareholders,” the former official said. “If Trump had even spent one day in a public company, he would understand the incredible pain of all of these on-again off-again, tariff threats, and uncertainty.”
Apple was bracing for tariffs amid the uncertainty. Cook warned that tariffs could bring down profits in the second quarter on an earnings call on May 1, estimating at the time that the tariffs could add $900 million to Apple’s costs.
Meanwhile, the U.S. has a massive trade imbalance with the E.U. on goods and had a $236 billion deficit with the European bloc last year. The U.S. also runs a $75.6 billion surplus with the E.U. on services, which includes U.S. exports of financial services, transport and telecommunications.
Trump often argues that the E.U has been ripping off the U.S. and only exists to take advantage of the U.S., telling reporters on Friday, “I’m not looking for a deal. We’ve set the deal, it’s at 50 percent.”
“But, again, there’s no tariff if they build their plant here,” he said.
Vice President Vance also leaned into calls for companies to boost U.S. manufacturing in his remarks at the Naval Academy’s graduation on Friday, just hours after Trump’s new tariff threats.
“Our leaders traded hard power for soft power,” he told the crowd. “We stopped making things—everything from cars to computers to the weapons of war, like the ships that guard our waters and the weapons that you will use in the future.”
“Too many of us believed that economic integration will naturally lead to peace by making countries like the People’s Republic of China more like the United States,” he said.