analysis

Consequences for German consumers Will iPhones, Big Macs, and jeans soon become more expensive?

As of: 04.04.2025 16:10

The planned US tariffs are hitting consumers – especially in the United States. Will consumers here also soon have to pay more due to possible retaliatory tariffs from the EU?

ByThomas Spinnler, ARD Finance Department

The trade conflict has reached a new level with the US government's planned tariffs on products worldwide. Tariffs of 20 percent are to be imposed on EU products in the future. It is still completely unclear how the European Union will specifically respond to US President Donald Trump's threats. That there will be a response is likely to be clear.

It's equally certain that many beloved European products will soon become significantly more expensive for US consumers. But what about us? Will Germans have to pay more for products from US manufacturers in the future, such as the iPhone or Kentucky bourbon whiskey?

First counter-tariffs will soon be due

In light of the long-running trade dispute, the EU had already agreed on countermeasures for some US products before the recent escalation. Additional EU tariffs of 10 to 50 percent will therefore be imposed starting around mid-April on imports of US products such as bourbon, jeans, motorcycles, boats, US confectionery such as chocolate bars and chips, and peanut butter.

According to the EU Commission, US goods exports worth a total of around €26 billion are affected by the planned EU responses. Initially, goods worth around €8 billion will be affected, followed by goods worth around €18 billion.

Harleys"Made in Thailand"

One of the most famous examples of the "American way of life" are the motorcycles of the US brand Harley-Davidson, which are now expected to become significantly more expensive. Although the company has long since relocated some of its production to Thailand, the EU Commission, however, considered that customs duties were being circumvented, allowing them to continue to be treated as US products. This was finally confirmed by the European Court of Justice last year.

According to company information, a good 8,700 Harley-Davidson motorcycles were newly registered in Germany last year, an increase of almost 20 percent compared to 2023. Can this success be repeated with higher prices?

Hardly any US jeans on the market

Levi's jeans are also still viewed by many consumers as a quintessentially American product. While this is historically true, the jeans have long been produced in China, Bangladesh, Vietnam, India, and Poland, among other places. Therefore, prices in Europe are unlikely to rise significantly.

Overall, the German Fashion Association considers the impact of new tariffs to be manageable. Products imported directly from the USA do not play a significant role in the German jeans market. This is also confirmed by data from the Federal Statistical Office, which shows that the import value of jeans"Made in the USA" was only a negligible three million euros.

Bourbon drinkers have to pay more

The situation is different for American bourbon whiskey, with its many popular brands, which will also be affected by the tariff increases. Price increases are indeed to be expected here. Frugal connoisseurs could switch to Scottish, Irish, or Canadian whiskey. The high-proof drink is also produced in Japan, so there are alternatives.

Consumers don't have to worry about rising prices for soft drinks like Coca-Cola. Coca-Cola is produced and bottled in Germany. Since McDonald's is a franchise system, the Big Mac is unlikely to become more expensive due to an EU tariff reaction. And for those who prefer to make their own burgers at home, ketchup from the US brand Heinz is produced in the Netherlands and Poland, among other places.

The damage to Apple

The technology giant Apple will be hit hard by the planned new tariffs, if they come into effect. However, the consequences are likely to be felt primarily in the United States itself. After all, Apple products such as the iPad, iPhone, Apple Watch, and Mac computers are predominantly manufactured in Asia, in China, Vietnam, Thailand, or India.

Trump wants to impose high tariffs on some goods from there. The products will likely become more expensive in the US as a result, as manufacturers pass the tariff costs on to their customers. Analysts estimate that there could be massive price increases of up to 40 percent.

Does this also affect Apple customers in Germany? It's important to consider that the tariffs in the US would squeeze Apple's profit margins – and thus its profits. It's therefore not impossible that the technology giant will raise prices overall to offset these losses. This, in turn, would also be felt in Europe.

Taxes or levies on digital services from the US are also currently being discussed as possible countermeasures by the EU. This could affect customers of companies such as Google, Meta, Amazon, Netflix, and even Apple. If the EU Commission agrees on regulations, this could also have consequences for consumers' wallets.

Are Europe’s prices falling overall?

But there could also be positive effects. Moritz Schularick, President of the Kiel Institute for the World Economy (IfW), even believes falling prices are possible in Europe, at least in the short term. In an interview with the"Handelsblatt," the economist anticipates a significant price decline of up to two percent."If there is less demand for our exports in the US, more products will come onto the European market. And Chinese goods will also push into the more open European market. This will depress prices," he estimates.

Fueling could also become cheaper in the short term. Due to massive global economic concerns, oil prices are falling, which is also expected to make gasoline and diesel cheaper. The planned US tariff policy has not only shaken the stock markets, it has also led to significant price reductions on the commodity markets.

Much is uncertain

Ultimately, the potential impact on consumer prices in Germany depends heavily on the EU's countermeasures, which are still unclear. Whether and to what extent affected manufacturers can pass on the increased import costs caused by tariffs to their customers will vary greatly. Each product would have to be considered individually.

While Apple customers may be willing to pay more for an iPhone, the situation could be quite different for peanut butter and whiskey. And many consumer goods that appear to originate in the US are actually manufactured elsewhere.