German automakers warn of 'only losers' in Trump's trade talk

BERLIN -- Germany's auto industry pushed back on President Donald Trump's threat to levy tariffs on automakers including BMW, Audi and Mercedes-Benz, warning he risks creating a lose-lose situation for everyone.

In the latest tit-for-tat with the European Union, Trump warned over the weekend that he could tax European cars, which "freely pour" into the U.S., creating a "big trade imbalance."

But with more and more German cars made in America, that gap narrowed to about 64,000 vehicles last year as the homeland of Mercedes and Porsche ramps up exports from U.S. factories.

"In such a trade war, there are only losers, on all sides," Bernhard Mattes, president of German auto-industry lobby VDA, which represents BMW, Volkswagen Group and other German automotive companies, said in a response to Trump's comments. "We're watching the current developments with great concern."

Combined, German car factories in the U.S. produced 804,000 vehicles last year, with 430,000 of those exported outside the country. The number of German cars imported into the U.S., meanwhile, has slid about 20 percent since 2014 to 494,000 vehicles, the VDA said.

Trump's reaction likely stems from the lack of U.S. brands in Europe. While Ford is among the top mass-market brands in the region, General Motors sold its German unit last year after trying and failing to establish the Chevrolet nameplate in Europe.

Fiat Chrysler Automobiles sells Jeep vehicles in the region, but Dodge and Chrysler models are exotic rarities because of the region's focus on small cars.

German automakers have been pursuing U.S. expansion for years. Since 2013, brands like Mercedes, VW and BMW have added 5,700 jobs, increasing U.S. staffing to 36,500 people, according to the VDA.

BMW's largest facility in the world is in Spartanburg, South Carolina, which makes SUVs for customers in Germany and elsewhere, while VW is expanding production in Chattanooga, Tennessee.

The current trade arrangement "brings advantages for both sides," said Mattes, the former chief of Ford's German operations. Trump "shouldn't now carelessly put this at risk."