Small and Medium Enterprises (SMEs) in Germany express worries over potential indirect impacts of U.S. tariffs

US Tariffs: Concerns for German Small and Medium-Sized Enterprises Focus on Indirect Fallouts

German Small and Medium Enterprises primarily fretting over secondary impacts of US duties - Small and Medium Enterprises (SMEs) in Germany express worries over potential indirect impacts of U.S. tariffs

Here's what you need to know about the potential implications for German SMEs in sectors like metal, automotive, and machinery due to US tariffs, according to a recent study by DZ Bank:

1. Potential consequences include increased prices for their own goods in the US market or decreased demand for exports. DZ Bank shares that over two-thirds of companies in these sectors anticipate indirect, negative effects from US tariffs, as the business of their trading partners will likely be affected.
2. While 29% of companies are not overly concerned about US tariffs, they may face more significant challenges from potential counter-tariffs by the EU. Nearly 29% foresee direct consequences, such as higher purchasing costs, but only 19% expect no negative impacts.
3. DZ analyst Claus Niegsch offers a debutant perspective on higher costs: Although US goods might become more expensive, goods originally destined for the US market might instead find their way to Europe, potentially lowering prices here.
4. Between March 6 and 26, DZ Bank surveyed 1,000 German SME owners and managers, with the exact height of tariffs on goods from the EU still unknown at the time. Tariffs of 25% on steel and aluminum had already been implemented since March 12, with a potential 25% tariff for the automotive sector also on the table. The survey is said to be representative.
5. On a bigger picture note, US tariffs have significantly impacted global trade, leading to retaliation from countries like China and the EU. This can disrupt supply chains and affect exports, indirectly impacting German SMEs in sectors like metal, automotive, and machinery[1][3].

While the study provides an insightful snapshot of German SME concerns regarding US tariffs, it's essential to note that the global trade landscape is ever-evolving, and maintaining a pulse on ongoing tariff developments and their implications on sectors like metal, automotive, and machinery will be vital for German SMEs striving to stay ahead of the curve.

• Germany
• DZ Bank AG
• USA
• SMEs
• EU
• Frankfurt am Main
• Metal
• Machinery

[1] https://www.scmp.com/business/global-economics/article/3042560/fed-might-slap-20-tariff-chinese-goods-trump-announces [2] https://www.bbc.com/worklife/article/20220124-how-smes-have-survived-covid-19 [3] https://www.forbes.com/sites/danielfisher/2018/03/30/germany-is-now-the-winner-of-the-us-china-trade-war/?sh=4f932d7973f6

1. DZ Bank, a German financial institution, has pointed out that employment policies in EC countries, particularly in industries like metal, automotive, and machinery, could face a potential decrease due to the indirect fallouts from US tariffs.
2. Claus Niegsch, an analyst at DZ Bank, suggests that while US tariffs may increase the cost of certain goods, they could also lead to a decrease in prices in the European market, as goods initially destined for the US market might instead be rerouted here.
3. In a survey conducted by DZ Bank, it was revealed that the majority of German SMEs in the affected sectors anticipate negative effects from US tariffs, with over two-thirds expecting indirect consequences.
4. The study published by DZ Bank shows that while some SMEs in the said industries are not overly concerned about US tariffs, they may still face challenges from potential counter-tariffs by the EU, which could lead to higher purchasing costs.

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