Decrease in the allure of the United States as a preferred trade partner
In the first half of the year, German exports to the USA saw a significant drop, falling by 3.9% to €77.6 billion. This decline can be attributed, in part, to President Donald Trump's substantial tariff increases since January, particularly the imposition and recent increases in Section 232 tariffs on steel, aluminum, and related derivative products. These tariffs have had a profound impact, especially on sectors that rely heavily on these metals, such as household appliances like refrigerators, washing machines, dishwashers, freezers, and ovens[1].
The raised tariff rates to 15–20% on these products have increased costs for German exporters, reducing their competitiveness in the US market. Moreover, a 15% surcharge on most EU goods in the USA makes German products more expensive, further exacerbating the challenge[1].
On the other hand, Chinese imports to Germany have surged, with a near 11% increase to €81.4 billion in the first six months. China followed closely with around €123 billion in trade with Germany in the same period, making it a close contender for Germany's top trading partner. The influx of Chinese imports could indicate that China has begun redirecting trade from the USA to Europe[1].
The strong undervaluation of the Chinese currency, the Yuan, allows Chinese companies to offer extreme low prices, making their imports even more attractive[1]. However, the impact of US tariffs on Chinese goods in Germany is less directly documented. Historically, US tariff actions under Trump on Chinese products influenced global supply chains, potentially causing shifts in trade patterns that also impact German import markets indirectly through disruptions in Chinese exports and increased prices[1].
The close race between the USA and China in German trade is partly due to the increase in Chinese imports. If this trend continues, China could potentially regain the top spot among German trading partners later this year. Meanwhile, the reliance on Chinese suppliers is gradually eroding the German industrial base, according to IW expert Jürgen Matthes[1].
Despite the USA managing to retain its position as Germany's top trading partner, the lead is razor-thin, as stated by Commerzbank economist Vincent Stamer. The USA's import growth rate to Germany is significantly lower than China's, which could further widen the gap[1].
In summary, Trump's tariffs on steel, aluminum, and their derivatives have raised costs for German exports to the US, particularly in sectors reliant on these metals. The rate increase to 15–20% in 2025 further compounds export challenges for Germany in the US market. The impact on Chinese imports to Germany is less directly documented but influenced by broader trade tensions and resultant market adjustments. The surge in Chinese imports could potentially allow China to regain the top spot among German trading partners later this year, if the trend continues.
This analysis is based on the latest tariff updates documented in August 2025[1].
References: [1] Reuters, "Trump's tariffs take a toll on German exports to the USA, while Chinese imports surge", August 2025, link
The tariff increases on steel, aluminum, and their derivatives by President Trump have resulted in higher costs for German exporters in the finance sector, putting them at a disadvantage in the US market. The escalation of these tariffs to 15-20% in 2025 is anticipated to further intensify these business challenges for German exporters in the US. On the contrary, the sharp rise in Chinese imports has been significant, reaching near 11% in the first six months, and could potentially push China ahead of the USA as Germany's top trading partner, assuming the current trend persists.
